These 8%-Paying Funds Are Doing Something Truly Bizarre

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These 8%-Paying Funds Are Doing Something Truly Bizarre

When I explain the appeal of closed-end funds (CEFs), I usually start with the big headline and throw a few bullets afterwards, kind of like this:

CEFs yield an average 8%, and many of those dividends are sustainable and growing.

  • CEFs invest in a variety of reliable and popular assets, like stocks, bonds and real estate investment trusts (REITs).
  • CEFs often trade at discounts to the value of their portfolios. This is known as the discount to net asset value (NAV), and it means we can buy stocks, bonds and real estate through CEFs for less than we’d pay on the open market.

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These Snubbed Funds “Convert” Paper Gains to Huge 9% Dividends

I just read one of the best articles on personal finance I’ve ever seen.

The piece, titled “I Saved Too Much for Retirement: What I Wish I’d Done Instead,” by Martin Dasko and published on Yahoo Finance, warns of a very real danger: “If you save too much for retirement,” Dasko writes, “you could find yourself missing out on your best years, and even end up with a higher tax liability when you stop working.”

Of course, the article also says that it’s better to overprepare financially and warns of how difficult it is to retire on your own (“hire a professional!”… Read more

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These 3 Funds Could Pay You $4,000 a Month

Let’s go ahead and build ourselves an “instant” income portfolio throwing off a rich 8.8% yield. A yield like that, after all, could put a dividends-only retirement within our reach. Or at the very least help you scale back your day job and make up the difference with dividend payouts.

This, of course, is the essence of financial freedom, and my favorite high-yield assets, closed-end funds (CEFs), are our best play here. When we build our retirement with CEFs, we get to hold the top stocks, bonds and other assets, like publicly traded real estate investment trusts (REITs), out there.… Read more

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These 3 Funds (Yielding 10.2%) Could Pay for Your Whole Retirement

With the recent pullback from the market’s high this year, we’ve got a nice second chance to buy some terrific dividend stocks cheap. But don’t waste your time with lame payers like General Mills (GIS), with its 2.5% yield. Or the miserly 2.1% you get from a so-called “Dividend Aristocrat” like McDonald’s (MCD).

Even though inflation is trending downward, it’s still at 5%. That’s well ahead of these pathetic blue-chip yields—and with the economy still performing well, it could be a while yet before it slows meaningfully from here.

Bottom line: We just can’t afford to own low payers like these any longer.… Read more

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How to Play (Overdone) Real Estate Worries for 8.1% Dividends

Here at Contrarian Outlook, we love to get questions from readers, and I recently got one from a CEF Insider member about commercial real estate, after Bank of America (BAC) recently said the sector could be the next one to tumble.

Let’s dive into that, because this fear has been driven by the same kind of overwrought media coverage we saw with regional banks (an issue that’s been addressed, by the way, with no depositors or taxpayers losing money).

And that fiasco, you no doubt know, gave us a nice “buy the dip” opportunity on, well, pretty well everything.

The media has set up these commercial real estate worries, too, and that’s highlighting the value of an 8.1%-paying closed-end fund (CEF) holding real estate investment trusts (REITs) we’ll talk about below (not to mention the five REIT CEFs in our CEF Insider portfolio).… Read more

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Forget the Dividend Aristocrats: This “3-Click” Portfolio Yields 10.5%

Despite last week’s market pop, there are still plenty of terrific dividend buys out there. But don’t waste your time with lame payers like General Mills (GIS), with its 2.7% yield. Or the miserly 2.2% you get from a so-called “Dividend Aristocrat” like McDonald’s (MCD).

Inflation is still at 7.7%! That’s far ahead of these pathetic blue-chip yields. We just can’t afford to own low payers like these any longer.

We need much more income if we want to achieve the dream scenario: a retirement funded entirely by dividends. That’s the path we’re going down today, with three closed-end funds (CEFs) boasting an incredible average yield of 10.5%.… Read more

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The 60/40 Portfolio Can’t Hold a Candle to This 10.4% Dividend Strategy

I hate to hear about investors using “rules” like the 60/40 portfolio (where you devote 60% of your holdings to stocks and the rest to bonds) to invest their hard-earned cash.

The problem with “rules” like this one is that they lack the ability to adjust to changing markets, like the mess we’ve been living through this year, which has walloped stocks and bonds in equal measure.

Advisors See the Light on Oversimplified “Rules” Like the 60/40 Portfolio

It seems like advisors and the business media are finally accepting this hard truth. Recently, banks like Goldman Sachs (GS) and JPMorgan Chase & Co.… Read more

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This 6.6% Dividend Is on a Rare “Discount Sale” (But Not for Long)

There’s a group of dividend payers out there whose businesses are doing better than they were before the COVID mess, but their stocks are still ridiculously cheap today.

Best of all, we contrarian income seekers can get these stocks at an even deeper discount than regular folks can—while collecting a healthy 6.6% dividend.

The trick? Buy them through a closed-end fund (CEF) like the one we’ll discuss below.

But let’s not get ahead of ourselves. The investments we’re going to buy through this CEF are real estate investment trusts (REITs), which own and rent out various types of properties, from shopping malls to warehouses and cellphone towers.… Read more

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Beat the Recession AND Inflation With This “3-D” Portfolio (Yields 8%)

When it comes to high-yield closed-end funds (CEFs), I’m a big fan of the “three Ds”: discounts, diversification and—of course—dividends!

These days, a “3-D” portfolio is a snap to put together, with CEF dividends at multi-year highs and oversold discounts everywhere across the asset class.

Below, we’ll look at a three-fund, bargain-priced “3-D” CEF portfolio you can buy today. It yields 8% now and gives you the diversification you need to reduce your volatility—and collect your payouts in peace.

I know that preaching diversification at a time when bonds, stocks and everything else is down might sound a bit outdated, but over time, this time-tested strategy always pays off.… Read more

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Play This “Quiet Shift” in Housing for 7% Dividends and Upside

Demand for rental property is literally going through the roof—and we can play the trend for a rock-solid 7% dividend that can be had at a discount!

What’s driving this opportunity? Higher interest rates. As you can see below, the average 30-year mortgage issued today bears an interest rate near 5%, a level we haven’t come close to since the subprime-mortgage crisis.

Mortgage Rates Soar

The trend is so aggressive that it’s getting analysts and journalists into full-blown panic mode, as they begin to report on what I call “seller’s remorse.”

Seeing how rates are soaring and home values are hitting a bump, sellers are already reducing their asking prices and looking to offload property as fast as possible.… Read more

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