Investors love dividends, because they are cash payments that can help pay the bills. We also like it when our stocks and other investments to go up in price because others are willing to pay that higher price to buy them. Too often investors focus on getting the highest dividends and forget about the better gains from price or capital appreciation. There are ways to accomplish both high dividends (high yield) and excellent capital gains using diversified Closed-End Funds that you can buy and sell like a stock.
The Best of Both Worlds
Investors should consider 4 diversified Closed-End Funds that have excellent yields (dividend distributions) and also have potential for capital appreciation:
- GAB – Gabelli Equity Trust – a Multi-Cap fund with a 5-star Morningstar rating – 7.94% yield and a 52-week gain of 29.36%
- GDV – Gabelli Dividend & Income Trust – A Large Cap fund with a 4-star Morningstar rating – 5.10% yield and a 52-week gain of 34.54%
- HQH – H&Q Healthcare Investors – a Sector fund (no rating from Morningstar) – 7.15% yield and a 52-week gain of 41.82%
- SOR – Source Capital – a Mid Cap fund with a 3-star Morningstar rating – 4.68% yield and a 52-week gain of 24.91%
Be sure to conduct your own detailed research before making any purchases of these Closed-End Funds.
The U.S. Stock Market continues to be stuck in a narrow trading range with no significant catalyst to drive it up or down. Since earnings season is essentially over, the markets are focusing on economic data and any potential actions by the Federal Reserve to change their easy money policies.
There is no change in our TSOA retirement accounts allocations.
Our Fun Stocks Index hit new highs this week – up to 592.75% since January 1, 2009 and up 68.11% year-to-date.
Next week our Stock Market Report will be on Friday, November 29th, the last trading day of the month.
Good Investing and Happy Thanksgiving!
Midweek Stock Market Report – November 20, 2013