EXTREME DIVIDEND USERS GROUP
Hi everyone.
It has been a while since we have had something new to write about. With all the craziness that is happening in the market, some of you have asked for discussions regarding the current eco-political risks and opportunities, as well as updates on our investment strategies.
Our first principle idea is to buy positions (even small ones) in extreme dividend assets, and reinvest at least some of our profits in those or other similar assets. Our second principle is to pretend we are the banker maintaining and using some cash for bargain hunting when high volatility craziness drives down stock prices that panic stupid investors into selling cheap. Just like the big bankers, some of our profitability is captured by investing in the over-reaction of other people’s greed and fear.
We are not immune to the driving stresses of greed and fear ourselves but if we listen to the worlds most successful investors like Warren Buffett or the late Charlie Munger, we discipline ourselves to sell parts of our positions when the demand is high and to buy bigger when the demand is low. This strategy allows us to usually maintain dividend income and embellish it each time our portfolio is stressed.
SO WHAT IS HAPPENING NOW???????????
Our world is suffering
Wars and rumors of wars (which have a direct effect on the costs of shipping and energy),
Political/economic effects from current government and potential post election government that affect the economics of our spending habits and the availability of our monies to invest,
Foreign dominance of our supply chain which directly impacts our ability to generate personal and industrial wealth.
For example the United States Oil fund has long been one of our Extreme Dividend plays through the popular United Bank of Switzerland’s USOI Exchange Traded Note. USOI sells covered calls backed by USO share certificates purchased with bond money raised by the bank in 2019 from selling USOI notes (our shares). Every month a high percentage of whatever money they receive for the calls is paid to us as (coupon payments) shareholders in lieu of interest. When oil was over $100/bbl, the returns on these bonds exceeded 56%. At present the payout is at its all time lowest of 7.5%. Among the threats to the oil supply are wars, OPEC greed, and America’s idiocracratic policies. Yet because of the U.S. political process, prices of oil are being artificially suppressed with our diminishing strategic reserves, etc. Will oil be a good place to invest again??? Warren Buffet thinks so – every time OXY drops to $56/sh, Birkshire starts accumulating with a goal of total ownership. If Conservatives win the election, US Oil companies will be able to produce and ship more and cheaper product world wide. If the liberals win, short supply and removal of artificial support will drive up prices. In both cases the profitability of USO companies and USOI stand to gain. Post election Extreme Dividends in this market will again be possible. In addition, another choice, PBR is one of our foreign energy picks that can again pay great stock dividends.
Because of improvements in world trade and increased shipping distances due to war in the Middle East, SHIPPING rates have been recovering dramatically and a couple of our favorites like ZIM and DSX are already profitable and paying dividends after a pause.
The STOCK MARKET is directly affected by anything that enhances or diminishes our ability to build and maintain wealth. Lowering of interest rates, improved corporate earnings and improved international trade deals all have a positive effect. The fear in the market right now is that if liberals are elected, un-employed money could be subject to high taxation as excess wealth, and employed money could be heavily taxed even if capital gains are not realized. In addition there are a number of other business killing ideas on the liberal agenda that also would punish the economy with in order to buy voter support for liberals. Thus there is a lot of action right now on Gold, Silver and Bitcoin (other digital money as well). Fortunately, these volatile assets provide us with opportunities to earn great dividends from the activities surrounding their trading.
Bitcoin lately is trading in a range of $56,000 to $74,000 Check out the YAHOO FINANCE Chart . When Bitcoin is at the bottom of its range, all the assets related to Bitcoin are on sale. We actually collect big dividends of 4 YieldMaxETF assets related to Bitcoin business activity below: IF YOU WANT TO GET IN ON THE YIELDMAX SEPTEMBER DIVIDENDS YOU NEED TO BUY TONIGHT DURING AFTER MARKET HOURS OR TOMORROW BEFORE THE EX DIVIDEND DATE OF RECORD HITS. THE DIVIDENDS WILL BE ANNOUNCED TOMORROW ON GLOBENEWSWIRE.
CONY – Today’s price $13.65/sh – covered call option trading fund built around the COIN exchange stock – last month paid an 88.6% annualized dividend
MSTY – Today’s price $22.32/sh – covered call option trading fund built around MSTR, a company in the Bitcoin mining business – last month paid an 104.33% annualized dividend
YBIT – Today’s price $13.56/sh – covered call option trading fund built around, funds with exposure to Bitcoin – last month paid an 59.34% annualized dividend
ULTY – Today’s price $10.70/sh – covered call option trading fund built around YieldMax funds including exposure to Bitcoin – last month paid an 87.51% annualized dividend
Silver as both an industrial and collector metal, is in short supply and trades in a range of $26.5 to $32/oz but it has a hard holding above $30/oz, currently $28.12/oz. SLV represents a bullion inventory shares fund and SLVO is the UBS covered call ETN fund that pays great dividends.
SLVO – Today’s price $76.63/sh – covered call option trading fund built around SLV – last month paid an 22.59% annualized dividend
The traditional hedge against inflation in Gold which has crept up ~$1000/oz to $2526/oz in 2 years. There is a dividend play on it through UBS but it won’t be great unless there is a gold price breakout.
GLDI – Today’s price $153.25/sh – covered call option trading fund built around GLD – last month paid an 14% annualized dividend
Hot and trendy right now is AI – artificial intelligence. Anyone who watches the news sees frequent mention of NIVDIA – a profitable company that absolutely dominates this market. Right behind them is AMD. There are also big dividend plays from YieldMaxEtfs here:
NVDY – Today’s price $22.96/sh – covered call option trading fund built around NVDA – last month paid an 65.4% annualized dividend and sometimes pays double that.
AMDY – Today’s price $14.03/sh – covered call option trading fund built around AMD – last month paid an 36.8% annualized dividend.
Finally, there is the world’s largest retailer – AMAZON which by design is minimally profitable. There is also a YieldMax dividend play on it.
AMZY – Today’s price $19.17/sh – covered call option trading fund built around AMZN – last month paid an 29.65% annualized dividend.
Just so you know, tonight and tomorrow, I am trying to buy more NVDY, CONY, MSTY and YBIT.
Best wishes to all of you,
Clint