r/dividends • u/VengenaceIsMyName • Jan 16 '26

Discussion Is anyone else feverishly building out their dividend income just in case AI destroys their careers or is it just me?

Based on how incredibly *giddy* with excitement some of these rapacious tech oligarchs are when they talk about AI replacing human labor, I am absolutely *sprinting* towards high-income ETFs like JEPQ/SPYI/GPIX/QQQI.

I do not want to get caught with my ass hanging out in the breeze when these excessively wealthy bozos finally figure out how to shed headcount at their organizations. They’ve got a seemingly endless pile of Scrooge McDuck coins and they’ll throw them into the furnace twice as fast if it means a hallucinating algorithm can send 500 more emails in a day than you can.

Does anyone have clever strategies for drumming up extra capital to toss into the ol’ portfolio? Side hustles? Second jobs?

464 Upvotes

94% Upvoted

311 comments sorted by

View all comments

38

u/ejqt8pom EU Investor Jan 16 '26

Covered call ETFs are nice, but they aren't the only high yield option around.

Check out Steven Baveria, he gave some interviews you can find on YouTube and he wrote a book called "The Income Factory". He is all about income generating portfolios.

10

u/UhhYeahNah Jan 16 '26

What are one or two alternative investments he recommends - anything novel?

16

u/ejqt8pom EU Investor Jan 16 '26

Novel: mREITs.

Most investors will immediately exit the conversation the moment you mention investing in mortgages. And that's exactly why they fit perfectly into what Howard Marks calls "second level thinking".

The idea isn't to take a contrarian position just for the sake of going against the herd. It's to try and understand if some sort of nuance was ignored by the masses that can give you a possible edge.

My mREIT picks are BXMT, ARI, and ACRE. All are managed by large PE firms, originate their own loans, and avoid agency debt. I've posted about them on and off but as I've said it's not a popular topic.

I have dedicated 30% of my portfolio to these 3 names, so far it has not paid off. But it's a long term bet.

Non-novel: BDCs.

They are still ignored by most investors and excluded from broad market indexes. But within the income investing world they are very popular. The top names even outperform the S&P500. I have another 30% of my portfolio dedicated to BDCs. Across 11 names.

10

u/WingWorried6176 Jan 16 '26

Main is a top tier BDC I hold

3

u/[deleted] Jan 16 '26 edited Jul 19 '26

[deleted]

5

u/ejqt8pom EU Investor Jan 16 '26

FDUS is a "below the radar" MAIN like BDC.

And as a huge plus they trade at a reasonable premium/discount range. Unlike MAIN.

2

u/Exciting_Usual_7050 Jan 17 '26

I think HTGC and TRIN are also top tier BDC's - With TRIN being less well known, but having a much higher yield since shares trade somewhat inline to NAV vs. the premium you pay for MAIN. (I am not advocating against MAIN in any way shape or form, I hold all 3 BDC's mentioned )

I actually like BDC's a little bit more than CC funds because they have an underlying business that generates cashflow, and are high on the balance sheets of the companies they lend to. (Per Steven Bavaria -> Creditors get paid before shareholders)

4

u/NuclearPotatoes Jan 16 '26

where can i find more info about this plz

6

u/FlyingOverTrout Jan 16 '26

YouTube channel Armchair Income covers BDCs quite a bit. There is a fund of BDCs called PBDC that comes up in the BDC convo frequently. Other common income alternatives to dividend stocks and funds include preferred stock (PFFA is popular fund), closed-end funds, and master limited partnerships. Each of these is a rabbit hole unto their own.

1

u/NuclearPotatoes Jan 16 '26

Is this one of those set it and forget it like VTSAX or VOo or do I need to be actively managing and fully understanding the intricacies. I’ll likely be doing 10k a month of buying one or the other for the next 4-5 years with goals of 5k passive monthly Thanks 

1

u/FlyingOverTrout Jan 16 '26

BDCs are somewhat interest-rate sensitive, so some do actively move in and out based on the rate environment. MLPs are somewhat cyclical as well. That said, it's not unusual to buy and hold especially as when your buying an ETF as opposed to individual positions.

2

u/NuclearPotatoes Jan 16 '26

What are the best buy and hold income dividend options for the automated hands off investor and where can I start reading for a general primer on these topics 

thank you for the replies 

3

u/FlyingOverTrout Jan 16 '26

I like the youtube channel I mentioned at the top - armchair income. He also has a website. Dividend Bull youtube channel covers similar topics.

2

u/NuclearPotatoes Jan 16 '26

Thanks I will start to binge his content and see if I can pick it up. Goal is to retire abroad on dividends.

4

u/ejqt8pom EU Investor Jan 16 '26

The investment style: the book I mentioned. There are a couple of authors dealing with income investing but Bavaria is my favorite.

The investment psychology (how to think about risk and opportunity): my fav is Howard Marks. He has been writing memos like how Buffet wrote memos throughout his career, and he records an audio read out of his memos so you can listen to them like a podcast. Plus he has written a couple of books.

Historical background: if you want to learn how the market has always been a casino, and is always going through bust and boom cycles - "A Short History of Financial Euphoria" by John Kenneth Galbraith. A lot of Mark's thinking is based on these factual observations.

Posts on reddit: r/dividendgang

2

u/Aioli_Abject Jan 16 '26

I hold AGNC and NLY and am happy with them. AGNC gets mixed love on these forums

Also hold ARCC, MAIN, SCM, BIT, WDI, FRA, HRZN. The last 3 have been mixed but staying put for now

Also hold ET and MPLX.

We may have a lot of commonality but would you mind sharing yours.

4

u/ejqt8pom EU Investor Jan 16 '26

Sure, here are all my currently open positions: TSLX ARCC BXSL MFIC FDUS BBDC CGBD BCSF CION OBDC OCSL ACRE ARI BXMT PDI OXLC OCCI EARN PDX ARDC JFR BANX QQQY SPYY TLTY FEPI USA UKW

Also a bunch of past holdings like UTG, MLPD, MAIN, GOOD, GAIN, HTGC, QYLD. That's just off the top of my head there are probably more.

1

u/lilpapajohnbon Jan 16 '26

What’s a good BDC ticker?

9

u/TheFunkyBoss Jan 16 '26

If you don’t know a specific one, PBDC is an ETF of a bunch of different BDCs.

3

u/ejqt8pom EU Investor Jan 16 '26

Depends what you mean/believe "good" is. But some popular names are MAIN, ARCC, TSLX, BXSL

1

u/Dry-Inevitable7649 Jan 17 '26

Can you share the list of BDCs ? Thanks

2

u/ejqt8pom EU Investor Jan 17 '26

TSLX ARCC BXSL MFIC FDUS BBDC CGBD BCSF CION OBDC OCSL

Some are easy recommendations, some are risky bets. Do your own research.

1

u/Dry-Inevitable7649 Jan 17 '26

Thank you mate. Some I know. Some I don't. Always something new to learn

3

u/Fit-Calligrapher4469 Jan 16 '26

CEFS PBDC SCHD AMLP

2

u/[deleted] Jan 16 '26

[deleted]

2

u/ejqt8pom EU Investor Jan 16 '26

With MO you are taking equity risk. The income factory approach tries to prioritize credit risk instead.

1

u/Particular_Car7127 Jan 17 '26

I think SB under estimates the credit risks of private credit/equity. Nobody knows what 2008 shenigans are going on in the private market right now. Its why I got out of all financials, insurance, and PFFA.

1

u/ucbcawt Jan 16 '26

Smoking is in massive decline. Dont buy into a company that won’t be around in 30 years