How to Squeeze a 13.6% Dividend From Gold (No One Does This)

Let’s face it: you hardly ever get decent income from commodity stocks. And when you do, these payouts are usually first to get the axe next time, say, oil nosedives.

And with oil doing this…

Oil Falls—Oil Companies’ Profits to Follow 

… you may worry that it’s about to get harder to squeeze income out of oil companies.

Still, if you’re worried about inflation or the Federal Reserve distorting markets, or if you just want to hedge your stock portfolio, you’ll likely turn to commodities at some point. And there’s no more established inflation hedge than gold.

There’s just one problem: gold doesn’t produce anything.

As Warren Buffett said, you could put all the world’s gold in one big cube and it still wouldn’t produce income for you. That’s usually how it goes—and most gold miners don’t pay dividends because they’re too busy pumping cash into the business to mine more gold.

Fortunately there’s another way to get cash out of gold—and no small amount, either: I’m talking a 13.6% dividend yield.

How? With the GAMCO Global Gold Natural Resources & Income Trust (GGN), an actively managed closed-end fund (CEF) that holds energy and gold stocks, and pivots between them when the time is right.

Current holdings include Barrick Gold (GOLD), Newmont Mining (NEM), Chevron (CVX) and Exxon Mobil (XOM).Plus, as I just mentioned, GGN now yields a whopping 13.6%.

And if you’re worried that GGN’s strategy can’t beat its benchmarks, don’t be. Here’s what the fund has done in 2019:

GGN Tops Gold, Energy—and the Market Itself

Here we see that GGN has easily beaten stocks. Plus it’s also topped the energy sector and physical gold—the latter of which is tracked here by the SPDR Gold Shares (GLD). Both energy and gold are far below stocks in general, due to worries that inflation won’t rise soon, despite the Fed’s hints it may cut rates shortly.

If you’re wondering how a gold/energy fund can crush both gold and energy while also beating the stock market, let me explain.

With its portfolio flexibility, GGN can pivot between the two asset classes and buy what’s undervalued at the time. It can also avoid the worst of a downturn by cutting back on the weaker asset class, whether it’s gold or oil. This is why the supposedly safer energy index fund, the Energy Select Sector SPDR (XLE), fell further than GGN in late 2018—and while XLE still hasn’t recovered, GGN is already in the black:

Flexibility Is GGN’s Strength

What about the dividend?

GGN hasn’t cut distributions since early 2017, when the fund was still picking up the pieces from the 2014 oil crash, which also resulted in a dividend cut for GGN in 2014 (it’s worth noting XLE’s dividends were also cut at the same time, as were those of almost all energy companies). Fortunately, oil has been predictably range-bound since, making it easier for energy-fund managers to maintain their portfolios and payouts:

Oil’s New Normal 

And with GGN’s recent solid showing, it looks like the fund has found the perfect strategy for oil’s new normal, while also dipping into gold markets when necessary. If the Fed follows through with rate cuts to inflate the economy, expect inflation to follow, making GGN’s gold holdings, its strategy and its dividend a decent hedge against a Fed-driven stock market.

Urgent: Grab This Growing 10.7% Dividend Now—While It’s Cheap

If you want to go beyond volatile commodities, you can bulk up your portfolio’s safety and bag a mammoth 10.7% income stream with my top stock-focused CEF pick now.

I’ve made this top-secret CEF my No. 1 pick in stock-focused funds for 2 reasons:

  • It boasts an amazing 10.7% dividend yield.
  • Its cash payout is exploding, up an incredible 150% in the last decade!

How does this fund do it?

It’s run by an investment all-star team cherry-picked from 5 of the sharpest management firms on Wall Street.

Together, this crew invests in a “no-gimmicks” portfolio of value and growth stocks, all of which have deep moats protecting their businesses: names like Visa (V), Microsoft (MSFT), Alphabet (GOOGL) and Abbott Laboratories (ABT).

So how has this all-star team performed?

They’ve dominated, with most of my pick’s monstrous total return coming in cash, thanks to that huge dividend payout:

Crushing the Market in Cash

Finally, this fund trades at an unreal 5% discount as I write this. It’s only a matter of time before that shifts to a massive premium, propelling my pick’s market price higher as it does.

Michael Foster has just uncovered 4 funds that tick off ALL his boxes for the perfect investment: a 7.4% average payout, steady dividend growth and 20%+ price upside. — but that won’t last long! Grab a piece of the action now, before the market comes to its senses. CLICK HERE and he’ll tell you all about his top 4 high-yield picks.

Source: Contrarian Outlook

4 Video Game Stocks Breaking Out

Source: Shutterstock

The major U.S. averages are holding near fresh record highs, fueled by optimism over the Federal Reserve’s recent dovish turn. Still, markets remain worried about ongoing geopolitical tensions as well as tepid economic data.

The futures market is eagerly pricing in multiple interest rate cuts before the end of the year.

Setting aside the macroeconomic discussion, the underlying health of the American consumer seems solid as we approach the mid-point of the year — which is about when everyone starts focusing on the holiday shopping season and the stocks that are best poised to perform as spending ramps up. No surprise then that a number of video game stocks are perking up on the heels of the recent E3 entertainment expo in Los Angeles. Hype is building for new titles and a coming console hardware refresh.

Here are four stocks to watch:

Video Game Stocks: Electronic Arts (EA)

Video Game Stocks to Buy: Electronic Arts (EA)

Electronic Arts (NASDAQ:EA) shares are breaking up and over their 50-day and 200-day moving averages, setting the stage for a move up and out of a five-month consolidation range. Analysts at Nomura initiated with an overweight rating.

The company will next report results on July 30 after the close. Analysts are looking for earnings of two cents per share on revenues of $722 million. When the company last reported on May 7, earnings of 69 cents per share beat estimates by 10 cents on an 8.7% rise in revenues.

Video Game Stocks to Buy: Take Two Interactive (TTWO)

Take Two Interactive (TTWO)

Take Two Interactive (NASDAQ:TTWO) stock has been surging, on an upward trajectory since bottoming in March. Analysts at the Benchmark Company recently raise their price target to $130 after witnessing a jubilant reaction to its Borderlands 3 demo at the recent E3 show. They are also looking ahead to the next Grand Theft Auto game. The last installment, Grand Theft Auto V, was initially released in 2013.

The company will next report results on Aug. 1 after the close. Analysts are looking for earnings of four cents per share on revenues of $383 million. When the company last reported on May 13, earnings of 50 cents per share missed estimates by 25 cents on an 18.7% rise in revenues.

Video Game Stocks to Buy: Activision (ATVI)

Activision (ATVI)

Analysts at Needham recently sat down with management of Activision (NASDAQ:ATVI), who noted an intent to focus on monetizing core franchises including Call of Duty and sticking to a more frequent and predictable schedule of content releases. Coverage was recently initiated with a neutral rating by analysts at Citigroup.

The company will next report results on Aug. 1 after the close. Analysts are looking for earnings of 26 cents per share on revenues of $1.2 billion. When the company last reported on May 2, earnings of 58 cents per share beat estimates by 33 cents per share on an 8.7% decline in revenues.

Stocks to Buy: Facebook (FB)

Facebook (FB)

While Facebook (NASDAQ:FB) might not be the first name one thinks of when it comes to video games, the company is a major player both through its Oculus VR subsidiary as well as its social media-based games. Facebook as well as competitors are in the midst of the launch of “Gen 2” VR headsets with better tracking and resolution, among other features.

The company will next report results on July 24 after the close. Analysts are looking for earnings of $1.87 per share on revenues of $16.5 billion. When the company last reported on April 24 earnings of $1.89 per share beat estimates by 27 cents on a 26% rise in revenues.

As of this writing, William Roth did not hold a position in any of the aforementioned securities.

Pay Your Bills for LIFE with These Dividend Stocks

Get your hands on my most comprehensive, step-by-step dividend plan yet. In just a few minutes, you will have a 36-month road map that could generate $4,804 (or more!) per month for life. It's the perfect supplement to Social Security and works even if the stock market tanks. Over 6,500 retirement investors have already followed the recommendations I've laid out.

Click here for complete details to start your plan today.

Source: Investor Place