{"id":5352,"date":"2023-10-25T13:43:56","date_gmt":"2023-10-25T13:43:56","guid":{"rendered":"https:\/\/infundpros.com\/investment\/lock-in-your-big-dividends-before-2024\/"},"modified":"2023-10-25T13:43:57","modified_gmt":"2023-10-25T13:43:57","slug":"lock-in-your-big-dividends-before-2024","status":"publish","type":"post","link":"https:\/\/infundpros.com\/?p=5352","title":{"rendered":"\u2018Lock In\u2019 Your Big Dividends Before 2024"},"content":{"rendered":"
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Do not<\/em> miss these huge dividend yields we\u2019re seeing today. In a year or two, you\u2019re going to kick yourself<\/em> for not locking these income streams in.<\/p>\n

Take it from me. This bond guy nearly<\/em> missed the great home refi opportunity of 2020-21. Fortunately, I managed to wake up and lock in a 2%+ mortgage before rates skyrocketed. Today, 30-year mortgage rates sit at 8% Eight percent!<\/em><\/p>\n

I mention that only because we have a similar setup in dividends today. In a moment, we\u2019re going to discuss an elite dividend paying 8.5%. Let\u2019s not miss it!<\/p>\n

From Mortgage Refis to \u201cDividend Refis\u201d<\/h2>\n

Here\u2019s the upshot: the same trend that delivered that sweet refi opportunity three years ago is driving our dividend<\/em> opportunity today\u2014just in reverse.<\/p>\n

I know nobody wants to talk about 2020, with its lockdowns and backyard bars, but bear with me for a sec. In those days, to put it mildly, the economy was flat on its back. The Fed was pumping out printed cash, and the yield on the 10-year Treasury bottomed out around 0.5%.<\/p>\n

That decimated mortgage rates and sent dividend stocks through the roof, dropping their dividend yields<\/em> in turn (because yields and prices move in opposite directions).<\/p>\n

It all made sense\u2014if you wanted yield, stocks were the only game in town!<\/p>\n

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Today, the script has flipped. Treasury rates just broke over 5%\u2014 drawing investors away from dividend stocks \u2026 and sending the yields on our favorite tickers soaring.<\/p>\n

But that won\u2019t last.<\/p>\n

You and I both know this economy is slowing down. Powell almost broke the banks back in March, and he\u2019s not<\/em> going to risk another crisis. Just look at how quickly he changed course when Silicon Valley Bank, Signature Bank et. al. cracked:<\/p>\n

What we\u2019re looking at here is the Fed\u2019s balance sheet\u2014you can see how it started letting its bond holdings \u201croll off\u201d as they matured, starting in mid-2022\u2014so-called \u201cquantitative tightening\u201d in action.<\/p>\n

That spike in early 2023? That\u2019s when the Fed got spooked and temporarily reversed course, suddenly adding<\/em> to its bond holdings out of fear of breaking the banks.<\/p>\n

The Fed said little about this at the time. But it\u2019s proof positive <\/em>that as the economy slows, Powell & Co. will be quick to can their tough talk and cut rates. And the 10-year, which is much<\/em> more dialed to investor moods than the Fed, will likely head lower before that.<\/p>\n

And that will trigger a flood of folks out<\/em> of treasuries and back<\/em> into dividend stocks. The time to \u201cfront run\u201d them is now,<\/em> so we lock in today\u2019s high yields for the long haul. But what do we buy?<\/p>\n

Add an \u201cX\u201d to This Ticker for a Deep-Discounted 7.7% Dividend<\/h2>\n

When looking for investments that will soar out of a downturn, it pays to look for the ones that were pounded the hardest in the crash. These \u201cgarbage pail moments\u201d are gifts to savvy contrarians like us, and right now we\u2019re looking squarely at tech, which took a header in \u201922. It\u2019s rebounded this year, but the tech-heavy NASDAQ still sits about 8% below its peak.<\/p>\n

For tech exposure, first-level investors often look to the Invesco QQQ Trust (QQQ),<\/strong> an ETF that tracks the NASDAQ, so it\u2019s no surprise that the main holdings are companies like Apple (AAPL), Microsoft (MSFT)<\/strong> and Amazon.com (AMZN).<\/strong><\/p>\n

Trouble is, QQQ is a pathetic payer, yielding just 0.6%. But if you go one step further and add an \u201cX\u201d to that ticker, you get a closed-end fund (CEF) called the Nuveen NASDAQ Dynamic Overwrite Fund (QQQX).<\/strong> This one holds all the same stocks but with a twist\u2014two, actually:<\/p>\n