I currently hold WEA and PPT. They have both come down considerably in the past several days. Both now sell at discounts and yield 9.5 and 11.5%. Both reported 100% of income distributed last year was "earned". PPT is 54% investment grade and 70% BB or better. WEA is 65% investment grade and 75% BB or better. WEA is domestic, PPT is 50% global. An equal investment in both funds pays a 10.5% dividend paid monthly.
If you are an income investor and are not concerned with market values this is a great time to have extra money. Of course 6 months and 18 months from now may be better. Personally I don't try to pick a bottom for income investments. For example if bonds drop another 10% on NAV the revenue generated on a $50,000 investment increases from $5,250 to $5,775. Of course if you wait a year to jump in and are sitting in cash you miss out on $5,250 of income and then have to hope you guessed right.
In my opinion for retirement,if you can live only on the interest, any time you can obtain a premium sustainable yield by investing available cash, do so. Dollar cost average in as future cash becomes available and don't worry about market values. Of course if you are in a position where it may be necessary to liquidate assets to generate cash this is not a golden rule. But for those who can retire only with cash flow it is a stress free way to build and increase income over time. For me, it's all about income. I live the same whether I earn 9% on a million or 4.5% on 2 million as long as the cash flow is sustainable.
I always enjoy reading your comments.
I am 55 and thinking about retirement which I can do anytime. My only concern is the lack of healthinsurance my employer currently provides.
Any suggestions where one can buy affordable health insurance? Here in Washington State the plans want over 900 bucks a month per person, which is a little steep...
I have Blue Cross Blue Shield. It is an international policy with a 5,000 deductible. My premium is $611.00 per month total for my wife and me. It increases each year as an inflation factor and has one more age adjustment at age 60 at which time the premiums are fixed except for the annual inflation adjustments.
It is possible to purchase health insurance in Mexico for the better hospitals for about 2,000 per year. This covers you in Mexico and has a small $50,000 benefit for the US.
Below is, I think, the URL for the article mentioned about Bill Gross and the CEFs he is purchasing. Thank you for your interesting, informative posts. All the best!!
I'm not quite retired yet, but I'm building my ROTH up to be an Income investment vehicle. I made several buys of PPT over the last 3 weeks, kept purchasing as it kept dropping. My last buy was at 5.94. Just hope they don't cut the distribution like many funds are doing. I'm within .08 of breaking even on this ADVDX, not counting any divys I've already collected.
I'm following the same strategy, tax free income in my ROTH. I'm actually ahead on my ADVDX, so I'm happy with that. I have a basket of income producers: ADVDX, GAUCX, EOS, NHS, NRO, PSEC and perhaps some PPT with this years contribution. The only real downside to a ROTH is the $6k yearly contribution limit.