Dividend Investing Weekly: Time to Consider Leveraged Corporate Bond Funds

You are receiving this email because you signed up to receive our free e-letter Dividend Investing Weekly, or you purchased a product or service from its publisher, Eagle Financial Publications. [Dividend Investing Weekly] [Cash Machine]( [Quick Income Trader]( [Breakout Profits Alert]( [Hi-Tech Trader]( Time to Consider Leveraged Corporate Bond Funds by Bryan Perry Editor, [Cash Machine]( 07/01/2024 Sponsored Content [This New Idea is Set to Shock the World]( It seems that everything Elon Musk has done throughout his career sounded insane at first.. Which is why it's important that you pay attention to his latest, strange invention. It's an AI device that could be the most powerful technology ever created. This new idea is set to shock the world once again - and this time, you don't want to be a nonbeliever. [Click here to learn all the details.]( The primary takeaway from last week’s slowdown in inflation for the U.S. economy per the Personal Consumption Expenditures (PCE) Index report is that a rate cut in September is very much on the table, but don’t count out the outside possibility of a cut at the July 31 Federal Open Market Committee (FOMC) meeting. Four more weeks of disinflationary numbers could prompt the Fed to consider starting the easing process, even though the CME FedWatch Tool is showing a nearly 90% probability of no cut in store. This week, investors will digest the release of the S&P Global U.S. Manufacturing PMI-Final for June, the ISM Manufacturing Index for June, the JOLTS Job Openings for May, the ADP Employment Change for June, the Weekly Initial Unemployment Claims, the S&P Global U.S. Services PMI-Final for June, the Factory Orders for May, the ISM Non-Manufacturing Index for June, the Non-Farm Payrolls and the Unemployment Rate for June. It’s a big week for data the market will certainly trade off of, and because of summer light volume, volatility will likely be elevated. Assuming the pipeline of data continues to demonstrate disinflation at work, where the economy experiences slowing growth, but no recession, it might behoove income investors willing to go out on the risk curve to take a hard look at high-yield bonds, and specifically leverage high-yield bond closed-end funds that pay double-digit-percentage yields. Following a cycle of 11 rate hikes, this asset class is selling well off the 2022 highs right before the Fed embarked on its tightening cycle. The investment proposition is a trifecta of catalysts for leveraged junk bond funds. The first being the Fed beginning a cycle of sequential rate cuts that occur over the next 18 months. The second is the cost of leverage declining meaningfully, and the third is the historical price appreciation for fixed income assets in a market where rates are on the decline. [If Americans Are Not Worried About Running Out of Money, They Should Be!]( According to the Survey of Consumer Finances (SCF), nearly half of all U.S. households have no money at all saved for retirement. Among those already retired, the savings rate is better... but still only $171,000 in 2022. Yet there is simple but little-understood solution to this looming retirement crisis. If investors move [quickly enough](, they can LOCK IN a regular source of extra income with annual returns as high as 11.1%, guaranteed for life. That’s 761% greater than the average S&P 500 dividend. What’s more, these payments are NOT affected by anything going on in the stock market or in other financial markets. There’s only one downside: this rare opportunity to lock in DOUBLE-DIGIT returns for life may not be available much longer. [Click here to find out more!]( Take for instance one of the largest high-yield corporate bond funds that has $5.2 billion in assets that controls $8.4 billion marketable securities, implying 38% leverage. The PIMCO Dynamic Income Fund (PDI) is one of the most aggressive strategies in the space, and because of its outsized leverage, lost 52% of its value from just before the pandemic to Q4 2023, when the market rallied on hopes of Fed easing. Since then, the fund rallied on renewed hopes of rate cuts and the fact that the economy didn’t slide into recession, thereby providing a backdrop of improving creditworthiness and more constructive corporate balance sheets for low-rated and non-rated debt. It should be noted that money flow into this fund has been bullish since the beginning of 2024, implying that, though rates have been higher for longer, institutional investors believe that lower rates are indeed forthcoming. Shares of PDI pay an annual distribution rate of 14.08%, whereas a closed-end fund such as the BlackRock Corporate High Yield Fund (HYT) with $1.4 billion in assets is using 30% leverage to control $1.9 billion in corporate debt securities and pays 9.84%. Both funds pay monthly payments. It is vital that investors do their own due diligence to understand the risks of such funds, but as is with any asset class, timing is everything, and now might be the time to consider the potential for total return. [Don't let the market burn you out]( You can either maintain full throttle, navigating the turbulence, or opt for a smoother ride with greater control. Traditional sources of trading insights often rely on lagging indicators and historical data, leaving you a step behind, struggling to keep pace and risking burnout. Imagine having access to a [revolutionary dual-patented tool]( that leverages past data to forecast future stock movements effortlessly. Our Pro Trader is ready to unveil 4 real-time A.I. scanned stock trends in this complimentary [LIVE A.I. TRAINING CLASS.]( This is a compelling set up in a market with opportunities to take full advantage of what could be a bullish trend. Professional bond investors have been patiently waiting for when to increase bond weightings in both investment grade and non-investment grade fixed income assets, and just maybe, a trend is developing following the head-fake bond rally earlier this year. If so, this sector gives investors the chance to lock in inflation-crushing yields coupled with capital appreciation. More light will be shed on this trade during the next four weeks of economic data points released and how the high-yield bond market responds to earnings season. There are times when bond returns can be very impressive, and this might be one of them. To learn more about leveraged corporate bond closed-end funds and other high yield investments paying double-digit-percentage yields, visit my website at [www.bryanperryinvesting.com]( and become a member of Cash Machine, which is beating inflation hands down and providing investors with an amazing stream of steady 10%+ stream of income. Sincerely, [bryan-perry-sig] Bryan Perry Editor, Cash Machine Editor, Premium Income PRO Editor, Quick Income Trader Editor, Breakout Options Alert Editor, Hi-Tech Trader Editor, Micro-Cap Stock Trader About Bryan Perry: [Bryan Perry]Bryan Perry specializes in high dividend paying investments. This weekly e-letter combines his decades-long experience in income investing with a simple, easy-to-read format that investors of all stripes can work into their portfolios. Bryan also serves as Editor of these services: [Cash Machine]( [Premium Income PRO]( [Quick Income Trader]( [Breakout Profits Alert]( [Hi-Tech Trader]( and [Micro-Cap Stock Trader](. 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