High Yield

If you are retired, retiring soon or in the distribution phase of life and need to build an income portfolio see the above high yieldings investments for further research. Investment options are grouped by the following equity, fixed income and alternative asset classes:

Equity

Covered Call
BDC
General Equity
International Equity
Real Estate
Utilities / Infrastructure
Energy
Healthcare

Fixed Income

High Yield Bonds
Collateralized Loan Obligation (CLO)
Preferred Stock
Hybrid or Multi-Asset
Convertible Bonds
Senior Loan

Alternative Income Assets

Cryptocurrency
Precious Metals

*Typically the higher the yield (or return) the higher the risk of an investment.

Terminology

ETF – Exchange Traded Fund. A basket of securities that trades on an exchange just like a stock does. ETF share prices fluctuate all day as the ETF is bought and sold; this is different from mutual funds, which only trade once a day after the market closes.

BDC – Business Development Company. An organization that invests in small and medium-sized companies as well as distressed companies. A BDC helps these firms grow in the initial stages of their development.

CEF – Closed End Fund. A type of mutual fund that issues a fixed number of shares through one initial public offering (IPO) to raise capital for its initial investments. Its shares can then be bought and sold on a stock exchange, but no new shares will be created, and no new money will flow into the fund. Closed-end funds are usually actively managed, and typically concentrate on a single industry, sector, or region. Source: Investopedia

Leverage – This is the percentage of a CEF’s assets funded by debt and preferred stock rather than capital contributed by shareholders. Leverage magnifies investment gains and losses, increases volatility, and can reduce a fund’s earnings when borrowing costs rise. We prefer low leverage.

Total Return % – The total return (capital gain/loss and dividends combined).

Important Notes:

*Most of the investment listed above do not meet IRS requirements to qualify for the lower tax treatment. As such these ‘non-qualified’ investments are best suited to be held in tax-advantaged accounts such as IRA’s and 401k’s. Check with your tax professional.

*These are not recommendations, but starting points for further research, always do your own due diligence and research.