I’m sure you’ve heard about the worries around private credit. They really hit the wall when Blue Owl Capital, a major private lender, put redemption limits on one of its funds earlier this year.

As investors, we must take note when such things happen. But we also need to remember that breathless media coverage of such events creates opportunities. That’s especially true in situations like this, involving a corner of the financial world many people simply don’t understand.

These are just the kind of setups we love to exploit at my CEF Insider service. And this one is handing us an opportunity in regional banks—and in particular, a closed-end fund (CEF) holding such banks, and turning their profits into a growing 6.4% dividend.… Read more

500 out of 500.

Do you know what that is? That, amazingly, is the number of stocks in the S&P 500 that the consensus says should be bought or held today. A perfect 500 out of 500.

Wow, so let’s do some “back of the envelope math.” There are 500 stocks in the index. And, let’s see, 500 should be bought or held. Which leaves…let’s see…zero sells.

Zero!

Meanwhile we have unprecedented business model disruption from the massive AI rollout. Biggest thing since the Internet or maybe even the railroads. Fortunes are being minted and vaporized with equal speed right before our very eyes.… Read more

I’ll cut right to the chase: I think the stock market—and our 8.8%+ yielding closed-end funds (CEFs)—could be on the brink of another spike.

If I’m right, we’ll have last week’s “disappointing” jobs report—which showed a loss of 23,000 positions in July—to thank. (And that 8.8% yield, by the way, isn’t made up: It’s the average payout on all CEFs.)

The stock market’s surprising reaction to that jobs report—it rose in response—also positions one of our CEF Insider tech funds very well indeed, with a deep discount to NAV (around 10.7% as I write this) that’s stair-stepping toward par.

That suggests even more gains are ahead for this powerhouse 7.3%-yielding fund, on top of the 37% total return it’s posted this year.… Read more

Be careful how you buy your bonds. The most popular tickers have four “fatal flaws” that’ll doom you to underperformance at best, or at worst leave you hanging in the event of a market meltdown!

Let’s pick on the widely followed and owned iShares iBoxx High Yield Corporate Bond ETF (HYG) as an example. It has attracted nearly $18 billion in assets because:

1. It’s convenient and as easy to buy as a stock.
2. It’s diversified (for better or worse, as we’ll see shortly) with 1,333 individual holdings.
3. It pays well, at nearly 6% today.

The accessibility of funds like HYG appears cute and comfortable enough.… Read more

Look, we contrarians always welcome a market rally like this one. But it does make our hunt for yield harder.

I mean, the S&P 500’s surge has ground down the index’s average yield to levels not seen since the 1800s!

Right now, the go-to index fund, the State Street SPDR S&P 500 ETF Trust (SPY) yields 0.98%. So you’d be pulling in a pathetic $9,800 on a million bucks invested. To get a liveable $50k in income, you’d need to invest $5 million.

Yikes!

Clearly, we need to widen our “strike zone,” and look beyond dividend yield to get the dividend cash we demand.… Read more

At my CEF Insider service, we’ve long seen high-yield bonds as a critical part of our portfolio. And I’ve got a bond fund for you today that:

1. Has crushed stocks in the last five years (which is pretty well unheard of for a fund holding corporate bonds).
2. Generates a high, stable yield (I’m talking 7.5% payouts here, with the odd special dividend thrown in).
3. Is cheap, with a discount to net asset value (NAV, or the value of its underlying portfolio) of 8.8%. And I see that discount resuming its march toward par, putting upside pressure on the fund’s price as it does.

We need to talk about four of the cheapest dividend payers on the planet. I’m talking about blue-light bargain valuations and, our favorite, serious high yields!

These four pay from 4.7% to a terrific 12.6%. Yet the Wall Street suits have left them for dead, on the side of the road (or Street, if you will!). Which is fine with us careful contrarians. We’ll sort through the sale rack.

Let’s start with a telecom that stays cheap yet keeps paying us nearly 5% because this divvie perennially finds its way into the suits’ doghouse.

AT&T (T)
Dividend Yield: 4.7%

AT&T (T) is one of telecom’s “Big Three” alongside competitors Verizon (VZ) and T-Mobile US (TMUS).… Read more

The recent blowup at Situational Awareness, a hedge fund run by a so-called AI “whiz kid,” tells us a lot about the mindset of the mainstream crowd these days—and what we need to do to avoid falling victim to it.

In fact, the same selloff that broke Situational Awareness put one of our favorite tech CEFs on sale. More than that: This steady payer is trading near discount levels not seen in more than a decade.

An AI Fund Built on Hype and Debt

After working at OpenAI (and being fired in April 2024), Leopold Aschenbrenner wrote an essay called “Situational Awareness” that got a lot of attention and later became the name of his hedge fund.… Read more

You ever buy a stock, watch it go up quickly, feel like a genius…only to watch it top out and take back some of your gains…and then all of them? It’s a—let’s admit it—stupid feeling.

The winner, now a big fat loser. Why didn’t I take the money and run!

“Be patient,” they say. “You’re here for the dividend. The stock will come back.” Well, first, who the heck are they? And second, why should patience be required? It was a fast winner. Now it’s a big fat loser!

Well, my careful contrarian, I ran the numbers earlier this year.… Read more

Kevin Warsh is talking tough on inflation. The bond market is calling BS.

Whenever the Fed and the bond market face off, it pays to remember the words of “Ragin’ Cajun” James Carville:

“I used to think that if there was reincarnation, I wanted to come back as the President or the Pope or a .400 baseball hitter. But now I would want to come back as the bond market. You can intimidate everybody.”

Until this fight gets straightened out, we’re in for some turbulence.

We contrarians are here for it. When markets roil, the crowd tosses perfectly good payers over the side.… Read more