This 89-Year-Old Investor Wants More Growth! My 52% Answer.

Brett Owens, Chief Investment Strategist
Updated: July 15, 2026

I need to ask your honest opinion, my careful contrarian! Should this reader move on from me?

“I’m 89 years young and active,” Peter wrote. “Don’t need income—only growth.”

(I’m the income guy. Do I have a growth arrow in my quiver, or should this young man look elsewhere to get rich?)

First of all Peter, you’re the man. You’re doing many, many things right to eschew current income at the spry age of 89. Good for you for staying active and for being in a position to still pursue portfolio price gains.

Peter went on to explain that he holds six of my official recommendations. He also owns the Vanguard Information Technology ETF (VGT). And then he dropped the hammer on me:

“Should I stop reading your missives? If so, which writer should I follow?”

Which writer—as in which other writer! Peter Pan, I appreciate the candor. Never get old, Peter. And never stop telling people how it is.

My main beat is high yields. Most readers here are retired, or approaching retirement, and looking to lock in that high income today. They are all about turning the pile of cash they’ve saved their entire lives into a sustainable dividend machine to fund their retirements.

Many have $500K to $1 million or $2 million or so. They like the 8% yields because they generate $40,000 per year on a $500K nest egg. Or $160K per year in payouts on $2 million.

But it sounds like you are in an excellent spot. Your pile is quite cushion-y and you just want to keep growing the nest egg. Awesome.

It’s rare to see a growth emphasis at age 89. Usually at 39, 49 or even 59—when we have years to decades to retirement—do we focus on growth. So Peter, don’t grow up! Let’s keep your portfolio rolling with the safest, securest way to more gains—the dividend magnet.

Over the long haul, stock prices follow their payouts higher or lower. Find me a company growing its dividend by double-digits and I’ll show you a long-term 10%+ annual total return machine! Dividend hikes are the most reliable way to invest in growth. We get rich on the dividend schedule.

The current yield of a dividend magnet stock never tips off what’s happening. It looks pedestrian at 1% or 2% or 3%. But what’s really happening is that the Peter Pan portfolio is flying along, humming at double digits per year alongside that dividend growth.

We’re doing a twist, Peter, on what you’re seeing with VGT. It’s a more nuanced, pick-and-shovel approach to the market. Let me give you an example.

EQT Corp (EQT) is the power broker behind many of the stocks you’re buying in your Vanguard fund.

We added it to our Hidden Yields dividend growth portfolio back in January 2024, discussing that there were only three sure things in life: death, taxes and the cyclical nature of natural gas.

At the time, gas fetched a measly $3.25 per million BTUs. Producers were shutting down their wells because they simply weren’t profitable. And of course, investors were fleeing the sector. And that’s why we bought—knowing that the cure for low prices was low prices.

EQT is the premier producer in Appalachia, sitting on nearly 4,000 profitable drilling locations at even rock-bottom gas prices! Yet at the time the stock was impossibly cheap, trading around six times free cash flow. The company was set to generate roughly $14 billion in free cash over the next five years, against a market cap of $15 billion. In other words, we could buy the whole company and get paid back by 2028. And we’re already more than halfway there, with the cash still rolling in…and its pace likely to pick up!

Fast-forward to today, and EQT’s market cap has ballooned to $37 billion. The reason? Natural gas for electricity generation is in high demand, with AI sucking up all the available juice it can find. Every time you ask ChatGPT or Claude what it thinks about something, the machines are spinning, and they demand energy. Skeptics can argue about how much a single query burns, but nobody argues about the gigawatts AI in aggregate requires.

So, how’s EQT doing? The price alone is up 47% since our initial buy, with more room to run!

In total we’re up 52%, including dividends. And this stock has more room to run because EQT’s natural gas is critical to the current AI build out.

Why do I still like EQT after this run? Two words. Two letters, actually: AI.

Let’s consider Homer City (not named after Mr. Simpson, to my knowledge, who lives in Springfield, anyway). This is a dead coal plant in Pennsylvania, once the state’s largest, and it’s experiencing a renaissance as an AI power campus. The Homer City location spans 3,200 acres and will produce 4.4 gigawatts of on-site gas generation. That’s the output of roughly four large nuclear reactors. It flips on next year, and EQT is the exclusive gas supplier in one of the largest single-site gas deals in North American history.

EQT is the power broker behind the bots. AI runs on electricity, which is ultimately EQT’s gas.

And this is the biggest buildout in modern American history. We’re talking about $700 billion of data-center spending from the “hyperscalers” (Google, Microsoft, Amazon and friends) this year alone! And that’s nearly double last year’s investment.

Current grid “wait times” are 5+ years. Want power? Take a number! Or consider “on-site natural gas” which is a VIP power plant right next door to the data center. (No line to wait in!) On-sites can deploy in just two years versus 5+. This is why “the natty” is booming and we’ll see more Homer Cities across the country.

Data centers are projected to boost America’s power-plant gas burn by 20% by 2030. Homer City’s contract alone supplies one-tenth of that increase and EQT is locked in to benefit:

The boom is already showing up in EQT’s top and bottom lines. First-quarter revenue nearly doubled to $3.4 billion, and profits nearly doubled as well.

And get this—gas itself is still cheap! “Henry Hub” standard variety goes for just $3.20 per million BTUs today, which is about the same it was trading at when we bought EQT. The company has nearly doubled its profits with zero help from gas price gains thus far.

As I mentioned (warned!) earlier, these “pick and shovel” payers rarely impress with their current yields. EQT yields just 1.3% today, which is fine for you, Peter. You’ll appreciate that EQT pays just 12% of its profits as dividends today and that management just raised its dividend in October by 5%.  More hikes ahead are likely.

So, to answer your question, Peter: please, no—don’t stop reading. Keep on asking the questions that investors half your age forget to ask. Yeah, we can do growth. Here’s how I’d recommend we do it responsibly.

As my kids are fond of pointing out to their friends: I’m 44 and a half (ah, youth). Halfway to you, Peter—and I aspire to be you when I grow up. Bless her heart, my youngest’s friend mentioned last week that there was no way her dad was in his 40s—he looked like he was in his 30s. I know 30 is ancient to an eight-year-old, but hey, I’ll take it. Halfway to you, Peter. Still chasing growth—with a protective stock seatbelt on!

And EQT isn’t the only dividend grower to buy here. Above where EQT operates—up on the land’s surface—we have a company that owns the buildings and cashes the rent checks from these hyperscalers. This company is basically the landlord to everyone participating in the AI boom. The biggest names in tech are paying rent to this firm.

A Stormy Market? We’re Interested. Two 9%+ Dividends to Buy

Brett Owens, Chief Investment Strategist
Updated: July 14, 2026

This market is in a three-way “tug-of-war”—and it’s set up some sweet deals on our favorite 9%+ dividends.

The Fed. The White House. Iran. A peep from any of the above and stocks soar (or tank).

But we contrarians can see through the short-term fog here.

We’re buying this volatility, in part because we’re playing the long game on AI, and the likelihood it’ll cap wage growth and inflation in the long run (more on that below).

But in the here and now, we need to play it smart—and zero in on payers that cushion our downside so we can collect their rich payouts in peace. I’ve got two closed-end funds (CEFs) that do just that—and throw off huge 9%+ yields, too.

Plus, these two funds help us avoid the mistake most investors are making now.

1 Click to 9X the Payouts Your Friends Are Booking

That mistake? When markets come under pressure, many investors look to a “plain vanilla” index fund, like the State Street SPDR S&P 500 ETF Trust (SPY), to take advantage.

The problem? SPY’s current yield is … 1%. One percent!

Want a $50,000 yearly income stream from SPY? Hope you’re prepared to invest around $5 million.

It’s too bad because SPY holders can easily grab dividends 9X bigger when they go just a bit past ETFs, to CEFs. Our first one holds the stocks in SPY, but instead of a sad 1%, it pays a 9.1% dividend that gets safer when markets turn stormy.

Swap the “Y” in “SPY” for “XX”—and Unlock a 9.1% Payout

That CEF is SPY’s high-yielding “clone,” the Nuveen S&P 500 Dynamic Overwrite Fund (SPXX).

The tickers are similar because like SPY, SPXX holds the stocks in the S&P 500, such as Apple (AAPL), Microsoft (MSFT) and Visa (V). But instead of SPY’s 1% dividend, you get SPXX’s sweet 9.1%.

Why the difference? SPXX sells call options. These give the buyer the right to buy SPXX’s stocks at a fixed future date and price. That generates extra income because SPXX keeps the “premiums” these buyers pay, no matter how these trades play out. The value of these options also rises with volatility.

SPXX then uses this cash to fund our payouts.

This strategy can cap upside in a rising market, as some of SPXX’s holdings get sold. But it also gives us most of our return as dividends, which is one way it cushions volatility.

SPXX has lagged SPY this year, with a 7.4% total return based on market price (in purple below), compared to 9.9% for the ETF. You’d expect that, as the bulls ran through the first half of ’26, despite the many whipsaws we’ve seen along the way.

But over that time, something curious happened: The performance of the fund’s portfolio (that is, its net asset value, or NAV), which strips out sentiment, has more or less matched SPY, returning 9.8% year-to-date (in orange below).

NAV Pops, Price Trails … and a Buy Window Opens

That gap has teed up a 9.1% discount to NAV on SPXX (which by coincidence matches the fund’s yield), much wider than the SPXX’s five-year average of 3.9%.

And if you look at the right side of the chart below, you’ll see that SPXX’s discount is starting to narrow again. That’s a sign that investors are placing more value on SPXX’s options strategy and are starting to buy in as volatility picks up:

SPXX’s Cheap (for Now) Valuation

This setup—a below-average discount that’s starting to narrow—is generally a smart time to buy a CEF. And while we wait for SPXX’s markdown to close, this “SPY clone” will pay us 9X what the original does.

Swap Your Bond ETFs for This 10%-Paying CEF

This opportunity isn’t only coming our way in stocks. It’s handing us deals in bonds, too. That’s because the herd is wrong on the direction of interest rates in the long run.

We already touched on AI, which provides a sweeping level of automation to white-collar work that is highly deflationary.

In the 1990s, the Internet acted as a similar “deflator” on prices. The move from snail mail to email and from fax machines to web browsers made businesses wildly more efficient, which kept a lid on consumer prices—and a floor under bond prices. They rallied throughout the entire decade.

Oil? Despite the latest tit-for-tat, prices are still well below their 2026 highs. And this conflict will end. Neither side can afford any other outcome. That’ll lead to a further drop in the price of the goo, and another gut-punch to inflation.

But the crowd doesn’t fully grasp any of this yet, so bonds are hated. That’s our cue.

One thing you do not want to do at a time like this is pick up a corporate-bond ETF like the SPDR Bloomberg High-Yield Bond ETF (JNK), which pays 6.6%. That’s not bad, but it pales in comparison to the payout of a corporate-bond CEF like the 10%-yielding DoubleLine Yield Opportunities Fund (DLY).

Not only is DLY’s yield 50% larger than that of the index fund, but it comes our way monthly, with the odd special dividend thrown in:

Source: Income Calendar

When it comes to performance, there’s no comparison. DLY is run by Jeffrey Gundlach, the so-called “Bond God,” who’s as connected as they come. DLY launched in February 2020, as the COVID dumpster fire was starting to rage. That let it buy the dips while the world went into lockdown.

And since bonds started to get up off the mat in late 2022, DLY (in purple below) has routed JNK, as typically happens with CEFs, which are actively managed.

The “Bond God” Grabs an Extra Jump in the Rebound

Even so, we can grab DLY at a 7.3% discount today, wider than its five-year average of 5.1%. That’s also cheaper than JNK, which, as an ETF, never gives us a discount.

The Investment Trusts available with high yields is diminishing, you may have to trim your yearly fcast for your Snowball as the trend continues.

There is always the ETF higher yield universe to research, so DYOR.

The current yield for the SNOWBALL is plus 7% as that doubles your income in ten years or less.

NextEnergy Solar Fund Limited (“NESF” or the “Company”)

Commencement of Formal Sale Process

NESF announced on 11 March 2026 the results of a strategic review, on 3 June 2026 the Company’s updated NAV as at 31 March 2026 and on 22 June 2026 the Company’s Full Year Results & Annual Report.

Notwithstanding the performance of its underlying portfolio of assets, NESF continues to have a challenging experience as a listed company, including a share price discount to its reported NAV that has persisted for several years and impacted its ability to raise new equity capital to fund its future growth. The board of NESF (the “Board“) also believes that it is challenged by the increased focus on shorter-term investment horizons by some parts of the public equity markets compared to the longer-term nature of its investments.

Since the announcement of the strategic review the Board has continued to engage with major stakeholders to understand their views on the Company’s future strategic options. Having evaluated this feedback and numerous alternatives to maximise value for shareholders, the Board believes that it would be in shareholders’ interest to investigate the sale of NESF and has therefore decided to commence a “Formal Sale Process” of the Company (as referred to in Note 2 on Rule 2.6 of the Takeover Code (the “Code“)) (the “Formal Sale Process“).

NextEnergy Capital IM Ltd, NESF’s investment manager, fully supports the Board’s decision.

The Board is not in any active discussions with any potential offeror and is not considered to be in receipt of an approach from any potential offeror as at the date of this announcement.

The Takeover Panel has agreed that any discussions with third parties in relation to an offer for the Company may take place within the context of a “Formal Sale Process” (as referred to in Note 2 on Rule 2.6 of the Takeover Code).

Formal Sale Process

As part of the Formal Sale Process, the Board invites expressions of interest from bona fide parties regarding a potential transaction for the entire issued ordinary share capital of the Company. The Formal Sale Process is being managed by the Board, which is being advised by Rothschild & Co.  Parties interested in participating in the Formal Sale Process or otherwise engaging with the Company should contact Rothschild & Co, using the contact details below.

The Company intends to conduct a process focused on those parties which understand and value the full potential of the Company.

Parties interested in participating in the Formal Sale Process will be required to enter into a non-disclosure and standstill agreement with the Company on terms satisfactory to the Board and on the same terms, in all material respects, as other interested parties before being permitted to participate in the Formal Sale Process. The Company intends to provide interested parties with certain information on its business, following which interested parties would be invited to submit their proposals to the Board. NESF will update the market in due course regarding timings for the Formal Sale Process.

What is a real estate investment trust (REIT)?

Story by Sam Shaw

MoneyWeek

REITs allow you to invest in various types of commercial property© Getty Images

A real estate investment trust (REIT) is a company (or group of companies) that owns and manages property portfolios, generating income and capital gains for investors.

At least 75% of their global profits must come from property rental income.

REITs can invest in many types of commercial property, such as offices, warehouses, data centres, shopping centres or industrial parks. Residential assets often include student accommodation, apartment blocks or assisted living facilities. They don’t invest in individual houses or flats. They might also hold the underlying land an asset sits on, or a site ready for future development.

What are the risks of investing in a REIT?

While REITs can invest with a broad focus, many take a focused view on one or two sectors, which can introduce concentration risk.

Max King, former fund manager and MoneyWeek columnist says excess supply and limited demand could lead a particular sector into a bear market.

“In that case, not only can net asset values (NAVs) fall but discounts to NAV can open up,” he says.

For this reason, knowing what to buy is the key, which is far from easy.

In King’s view, a specialist investment trust, like TR Property, would be a better option, letting the experts do the asset allocation for you.

You could build your own diversified portfolio of commercial property by selecting REITs from different sectors or countries. Or you may prefer to buy an exchange-traded fund (ETF) that tracks a broad index of property companies.

As with most property-related stocks, the share price of a REIT can be volatile, especially during periods of crisis when they may move more sharply than the wider stock market. But while investing in direct property can come with liquidity concerns (because property can be difficult to buy and sell quickly), as REITs offer investors shares in a stock market-listed company, liquidity is less of a concern.

HMRC estimates around 200 REITs are currently registered. Many large property companies, such as British Land and Landsec, fall into this category

These aren’t just a UK concept; the US, Australia, France and Japan also have similar regimes in place.

How are REITs taxed

REITs differ from standard investment trusts and other property funds through the way they are taxed.

In the UK, companies held inside REITs are exempt from corporation tax on any qualifying property rental profits and capital gains. But the REIT must distribute at least 90% of any rental income (not gains) every year to shareholders, within 12 months of the company’s year-end. These payouts are called property income distributions (PIDs), rather than standard dividends.

PIDs are usually subject to a 20% withholding tax – a tax paid directly to HMRC before you receive payment.

PIDs circumvent the need for corporation tax to be paid on the REIT’s holdings, meaning that shareholders in REITs can receive proportionately more money post-tax than through other property investment vehicles.

Certain types of institutional shareholders can qualify to receive PIDs gross – without the 20% deduction. Some of these include UK public bodies, charities or pension funds, for example.

Not all profits generated are PIDs or capital gains. Properties inside REITs can also generate profits from other activities (sometimes called ‘residual’ or ‘non-core’ activities), which might be interest payments, development or property management. These are usually taxed as ordinary profits, and treated as such. These residual activities must be no more than 25% of the REIT’s total income profits or assets.

When were REITs introduced?

REITs were introduced in the UK in 2007. The idea was to remove the ‘double taxation’ that had previously applied – where the core asset (building or piece of land) – paid tax and then shareholders also paid tax on receipt of any investment returns or income. Now, for most REITs, the tax is only collected when investors receive the payments, at their standard rate of income tax.

So while investors hold shares in the REIT (as it’s a listed company), it means they have a similar tax position to owning the property directly.

They may also be subject to other restrictions, such as caps on leverage, which is the amount they can borrow against their assets.

Stephen Yiu is co-founder and chief investment officer of the Blue Whale Growth Fund.

How to build a successful investment portfolio from scratch, by STEPHEN YIU of Blue Whale

Story by Stephen Yiu

Investing offers the chance of significantly higher returns than saving in cash.

This is at the ‘cost’ of watching your money go up and down in value on paper in the short term, but leaving your investment alone long enough makes short-term volatility irrelevant.

Contrary to what most people fear, it is not hard to do.

Here’s how to get started and then build up and manage a successful investment portfolio.

1. Beginners should buy ETF trackers

If you’re new to investing, Exchange-Traded Funds are a great first move. An ETF is a ready-made basket of shares that make up the index it is tracking, giving you exposure to lots of companies in one trade.

This instantly spreads your risk: if one company has a bad day, others can offset it.

Stephen Yiu: ETFs are low effort, low fuss, and the ideal foundation for new investors

ETFs are low cost, easy to buy and sell and transparent in their holdings.

For example, an ETF tracking the S&P 500 index provides instant access to America’s largest companies across multiple sectors.

ETFs are low effort, low fuss, and the ideal foundation for new investors. 

For many people, there is no need to venture beyond investing in ETFs to enjoy a successful portfolio, whether in their Isa or pension or both.

2. What ambitious amateurs should do next

By their very nature, your returns from ETFs are only ever going to track the relevant market, never beat it.

For many people, that is all they are looking for, especially given the low costs and ease of choice ETFs offer.

However, once you have cut your teeth with passive investment and built up a nicely diversified portfolio of tracker ETFs, you might want to be more ambitious and seek market-beating returns as the icing on the cake.

The first alternative for more ambitious investors is to look for consistent long-term success from competent, high-calibre active fund managers.

ETFs track the market, but successful active fund managers aim to beat it by spotting opportunities others miss, sidestepping risks early, and making informed decisions across all conditions.

Over time, this advantage can compound into a significant gap between ‘average’ returns and the kind of performance that builds lasting wealth.

But spotting and investing with a good manager is the trick. Here’s what to look for.

– Proven outperformance across multiple years and market cycles, not just one lucky run.

– Transparency and regular communication – keeping investors updated on positioning and performance.

– A clear, repeatable investment process that you can understand and trust.

Without this calibre of management, active funds risk becoming expensive index-trackers – in fact most active funds typically underperform their relevant index.

But when managed properly, truly active funds can be the powerhouse of your portfolio, delivering returns that passive strategies alone can’t match.

3. Investing for profit and pleasure

Picking individual company shares is the most hands-on approach for the more ambitious investor.

You control every decision and can enjoy substantial rewards if you back a winner early.

However, the risks are higher: company missteps, price volatility and concentration can hurt. Success demands research, discipline and the ability to stay calm during market swings.

At Blue Whale, even our professional investors (who analyse markets full time) typically cover just five companies each.

That’s how much work it takes to truly understand a business and its drivers. For private investors, replicating that depth across even a handful of shares can be prohibitive.

Financial ambition: Investing offers chance of significantly higher returns than saving in cash

The bottom line

A smart progression might look like this: start with broad, low-cost ETFs for a diversified base, then add proven active managers – the serious investor’s engine of outperformance – and finally, if time and interest allow, sprinkle in individual shares for challenge and enjoyment.

The real key is patience. Stay the course, ride out the bumps, and let compounding quietly work in your favour. Start early, stick with it, and you’ll give yourself the best shot at long-term financial success.

Looking at the chart of Blue Whale, you will notice there are long periods when prices go sideways or fall, a good time to own dividend paying shares as you fail by the month and not the year.

If you are investing for capital growth, your share should at least follow the markets when they are going up.

Small Caps, Energy Stocks and a 6% Yield. This Fund Has the Rest of the 2020s Covered

Michael Foster, Investment Strategist

Today we’re going to discuss a 6%-paying fund that’s quietly built a portfolio perfectly tuned for the rest of the 2020s

Few investors realize it … yet. Which is why we can grab this 6% payer (whose payout looks set to grow from here) at a 10% discount to its “true” value.

The fund in question is the Sprott Focus Trust (FUND), a closed-end fund (CEF) managed by Whitney George. He’s a manager you may have heard of: George is known for the profits he’s earned over the decades by focusing on two key areas: energy stocks and small caps.

Source: Sprott Inc.

You can see that reflected in FUND’s portfolio, the top-10 holdings of which are shown above. Familiar big caps are here, such as ExxonMobil (XOM), as well as mid-caps like manufacturer Westlake Corp. (WLK) and smaller fry, like Canadian contract driller Major Drilling Group—market cap: $1.24 billion—and mainly domestic food maker Cal-Maine Foods (CALM), with a $3.75-billion market cap.

It’s a good time to tilt toward George’s two specialties right now, because the benchmark ETFs for energy stocks (shown in orange below) and small caps (in purple) have been on a roll this year:

Energy Stocks, Small Caps Fly Through the First Half of ’26

When it comes to small caps, shown by the iShares Russell 2000 ETF (IWM), this short-term performance is compounded by the fact that, over the very long term, these companies (again, with IWM in purple below) outrun the benchmark S&P 500 ETF, the State Street SPDR S&P 500 ETF Trust (SPY), in orange.

Big Gains From Small Caps

However, this was not true in the 2010s, when the S&P 500 edged out smaller firms. That, in turn, weighed on FUND, until it began to edge higher earlier in the 2020s and really took off starting in early 2025.

FUND Gains Slowly—Then All at Once

This is a return to form, as George’s fund has been outperforming the small-cap benchmark ETF for a long time. If we go back to when that ETF went public, we can see that FUND (in orange below) has been outrunning it for its entire life.

FUND Crushes Its Small-Cap Benchmark

I expect that performance to continue as small caps return to their long-term dominance over their larger cousins. Moreover, FUND’s mix of small- and mid-cap companies, along with energy stocks, makes it a particularly savvy way to grab energy exposure. That’s because its smaller stocks outperform the benchmark over time, providing some cushion for its more-volatile energy holdings.

The classic case of this in action came during the pandemic, when oil prices, of course, briefly went negative. That was enough to send the energy-stock benchmark to a 50% loss—but not FUND: It only briefly turned negative in that time.

This makes sense: As COVID shut the world down, the focus shifted to more domestic-focused companies that didn’t have to worry about globe-spanning supply chains. Those tend to be small caps.

Plus, there’s the income, with FUND paying out that rich 6% payout mentioned earlier.

Source: Income Calendar

Now, 6% sounds like a lot, but remember that FUND has been hiking payouts for a decade now, and handing out big special dividends here and there, too (those are represented by the spikes in the chart above).

These payouts are possible because FUND’s NAV keeps rising, and the fund’s mandate is to pay an annualized rate of 6% of the rolling average of the fund’s NAV over the last four quarters, so a higher NAV will mean bigger payouts.

In other words, since that 6% yield does not account for those special dividends, that yield is best thought of as a floor—and one that’s likely to rise.

FUND’s Discount Slowly Narrows

This is especially true when we remember that FUND has a nearly 10% discount to net asset value (NAV, or the value of its underlying portfolio), but that discount bottomed out in mid-2024 and is now slowly moving back toward par. However, it’s still below the 9% level, so it may be some time before the markdown truly shrinks and we get some “closing-discount” gains on top of those generated by the fund’s portfolio.

But that’s fine. Because that 6% yield is safer thanks to this discount, since it also means management needs to earn just a 5.5% total annualized return on the NAV to sustain the 6% dividend yield, which is calculated on discounted market price.

The story gets even better, since FUND’s total NAV return over the last three years is 14.4% on an annualized basis, or nearly triple what it needs to sustain payouts. No wonder George has tossed out so many big special payouts over the last few years.

This also suggests that more such payouts are on the horizon. This fund is worth considering before the next one is announced, which will likely cause the discount to shrink further—and propel the price higher as it does.

Buy FUND today and I expect you’ll be looking at a much higher yield than 6% on your original buy in just a few years.

	Company	Place change
1	Royal London Short Term Money Mkt Y Acc (B8XYYQ8)	Unchanged
2	Vanguard FTSE Global All Cp Idx £ Acc (BD3RZ58)	Unchanged
3	HSBC FTSE All-World Index C Acc (BMJJJF9)	Unchanged
4	Vanguard LifeStrategy 80% Equity A Acc (B4PQW15)	Unchanged
5	Artemis Global Income I Acc (B5ZX1M7)	Unchanged
6	Polar Capital Technology Ord PCT1.84%	Unchanged
7	Vanguard LifeStrategy 100% Equity A Acc (B41XG30)	New
8	Henderson Far East Income Ord HFEL1.15%	Down 1
9	Scottish Mortgage Ord SMT2.57%	Unchanged
10	Greencoat UK Wind UKW0.29%	New

There’s very little movement in this week’s bestseller list, with seven funds maintaining the same position. Cash fund Royal London Short Term Money Mkt Y Acc  heads up the table, followed by three broad tracker funds and the value-oriented Artemis Global Income I Acc .

And yet a couple of new entrants have arrived. Vanguard LifeStrategy 100% Equity A Acc  returns to the table, while Fidelity Index World drops out of the top 10.

We also see the renewables trust Greencoat UK Wind  UKW

 move back into the list. That, like fellow top 10 constituent Henderson Far East Income Ord HFEL, has plenty of fans thanks to a high share price dividend yield.

Passive technology fund L&G Global Technology Index Trust slips out of the table. However, growth investing remains high up the agenda, with both Polar Capital Technology Ord  PCT

 and Scottish Mortgage Ord SMT still in the list.

Funds and trusts section written by Dave Baxter, senior fund content specialist at ii.

Thursday 16 July

Hansa Investment Co Ltd ex-dividend date
Invesco Bond Income Plus Ltd ex-dividend date
JPMorgan Asia Growth & Income PLC ex-dividend date
Montanaro UK Smaller Cos Investment Trust PLC ex-dividend date
Neuberger Private Equity Partners Ltd ex-dividend date
Schroder European Real Estate Investment Trust PLC ex-dividend date
TwentyFour Income Fund Ltd ex-dividend date
Utilico Emerging Markets Trust PLC ex-dividend date

How to generate a passive income in retirement

Here’s how you could supplement the State Pension in retirement through having a second income.

Posted by Peter Stephens

The Twelfth Magpie’s Premium Investing Services.

While the idea of generating a passive income may initially seem daunting, there are a number of assets available that could help you to reach your income goals.

Read on to find out more about them, as well as why it is a good idea to ensure you hold a diverse range of assets in retirement.

Investing in shares

Dividend-paying shares can offer a relatively high level of income. The FTSE 100, which is an index of the largest 100 companies on the UK stock market, has a dividend yield of 4.2% at the time of writing. This is likely to be higher than the income returns offered by many other assets, while the potential for dividends to rise over the long run could mean that shares have an inflation-beating income outlook.

Shares carry greater risk than many other assets, so it is important to research them before going ahead with a purchase. Factors such as the company’s debt levels, strategy and how much of their profit is used to pay dividends may be worth checking before buying them.

Should you wish to buy shares, opening an ISA could be a tax-efficient means of doing so. Researching various sharedealing providers could help you to find the best deal, with sites such as The Motley Fool offering a variety of reviews on them.

Investing in property

Purchasing a property is another means of generating a passive income in retirement. Even though property prices have risen significantly in recent years, it may still be possible to generate a relatively high yield in parts of the UK. However, due to the cost of buying property, it may be difficult to build a diverse property portfolio.

It is important to note that should a property you own go through a void period, or if a tenant fails to pay rent, this could cause a reduction in your income.

With the introduction of a 3% stamp duty surcharge in April 2016, as well as other tax changes, investing in property may be less appealing than it once was from a tax perspective.

Investing in bonds

Bonds are a popular means of generating a passive income in retirement. You lend money to a government or corporate entity, with the amount repaid on a specific date in future. In the meantime, interest payments, or coupons, are paid on the debt. They differ in level depending on the financial strength of the entity in question, with interest rates on less stable governments and businesses being higher than interest rates on more financially sound entities.

Although bonds can offer a more reliable income in some cases than dividend-paying shares, they lack capital growth potential. In some cases, this may mean that their total return is less than inflation. Over the long run this can lead to reduced spending power.

Bonds can be purchased through the same accounts as shares in many cases, with an ISA being a tax-efficient means of buying them.

Savings accounts

If you would rather not take any risks with your money but still want to generate a passive income, savings accounts could be an option. As long as you have less than £85k invested in a banking group, there is no risk of capital loss if it goes bust.

However, savings account returns are relatively low. At the time of writing, they are around 1.5% at best. Since this is lower than the long-term average inflation rate, it means that amounts held in them could lose their spending power over time.

It’s also important to note that no income tax is charged on the first £1,000 of interest income. For that reason, unless you will generate over £1,000 in interest income per year, having a savings account rather than a cash ISA could be a good idea.

Passive income tip: diversify

In order to enjoy a more consistent level of income, as well as a lower risk of loss, ensuring that you have a mix of assets from which to generate a passive income in retirement could be a good idea.

Shares, bonds, property and cash all have their advantages and disadvantages when it comes to risk and reward. While one asset may be right for one retiree, it may not be seen as ideal for another.

For example, shares may offer the highest income return at the present time. But they could experience a fall in value that then makes holding bonds a better idea, since their value may move in the opposite direction to that of shares during periods of uncertainty for the economy.

Therefore, diversifying with different types of assets in your portfolio may provide you with a more consistent income return that helps you to budget effectively in retirement.