Here’s one thing I can say for sure about 2026: This year, we’ll be grateful we’re NOT sitting on “America’s ticker”—my name for the SPDR S&P 500 ETF Trust (SPY).

I call SPY that because pretty well everyone owns it. But its 1% yield makes it more likely that holders will be forced to sell low in the next pullback, if they’re leaning on it to pay the bills.

Not us! We’ll be pocketing the 8%+ cash payouts from the portfolio of my Contrarian Income Report service. So while SPY holders face the next pullback with dread, we’ll be chugging along with our usual “dividends and chill” approach.

When a storm hits, we simply wait for our next big dividend payment to roll in. (And we don’t have to wait long—many of our divvies are paid monthly.)

Today I want to zero in on one attractive 13.4% (!) payer from our portfolio. Then I’ll show you a smart, simple way to forecast that massive dividend (and indeed any payout) with ease.

This 13.4% Payer Loves This “Bearish” Bull Market

We love FS Credit Opportunities (FSCO) for a lot of reasons, but its sky-high—and growing—dividend is right up there. FSCO yields a mammoth 13.4% today (more on that in a second).

Small businesses—the main drivers of US economic growth—love BDCs, too, because they loan money to these firms. BDCs are a godsend for these mom-and-pop shops, who often struggle to get the capital they need from stingy banks.

Most BDC managers sit in their cozy offices, wait for a private-equity sponsor to call, then write a check for a safe but low-paying loan.

Not FSCO. Portfolio manager Andrew Beckman buys distressed loans for dimes—even pennies—on the dollar. His chops in this arena drive the stock’s growing 13.4% payout.

FSCO: A True Dividend “Unicorn”

Source: Income Calendar

Beckman is the industry’s “credit surgeon.” Forget the safe loan! He wants the patient who’s bleeding out on the table because he can stitch them up—and charge a fortune for doing so.

Before FSCO, he spent the core of his career at Goldman Sachs (GS), in their legendary Special Situations Group. These “credit commandos” thrived buying depressed assets in the 2008/2009 crisis.

FSCO is a BDC in a closed-end fund (CEF) wrapper. As a CEF, it can (and does!) trade at different levels in relation to its value. Today, it trades at a 14.7% discount to NAV because slower jobs numbers are sparking recession worries. That means we’re getting FSCO’s expertly run loan portfolio for just 85 cents on the dollar.

Yes, hiring is slow, but that’s because companies are implementing AI to boost efficiency. And small businesses are the No. 1 users of this tech.

Meantime, the Atlanta Fed’s GDPNow estimate shows that the US economy is still solidly in growth mode: a strong 3.5% rate, to be exact.

The disconnect between investors’ mood and strong growth is our opening to grab FSCO, and its 13.4% payout, at a bargain.

— Brett Owens

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Source: Contrarian Outlook