These Income Machines Are On Sale; Yields +7%

If you could print unlimited money, would you do it all at once or gradually over time?

Some money printing is necessary—it's how economies grow. As the economy expands, the money supply must grow with it to support lending, spending, and investment. But printing too much too fast can lead to inflation or worse, a collapse in confidence.

That’s why the Federal Reserve targets 2–3% inflation: a slow trickle of new money helps the system function without shocking it. Done right, it’s barely noticeable. Done wrong, prices soar and purchasing power collapses.

Our Income Method at High Dividend Opportunities follows that same logic. We aim for consistent, sustainable income, not windfalls. It’s about building a stream of cash flow you can rely on for life, not burning through a one-time jackpot.

Today, let’s look at two defensive investments built for steady income.

Let’s dive in!

Pick 1: RQI – Yield 7.8%

Cohen & Steers Quality Income Realty Fund, Inc. (RQI) offers diversified access to this resilient asset class through an active management strategy that selects leaders. The CEF (Closed-End Fund) houses 193 holdings, but has some of the best-in-class REITs across sectors occupying its top ten positions. These represent ~48.5% of the fund’s market value. Source

Fact Sheet

About 82% of RQI’s investments are REIT common equity, while 18% represent preferred securities, providing modest exposure to the fixed-income space. Notably, the CEF’s top focus areas are those where tenants sign long-term leases and are less likely to move frequently – Data Centers (8%), Healthcare (13%), Telecommunications (14%), and Industrial (7%) properties.

RQI uses 29% leverage to amplify the returns from its active strategy. About 81% of the borrowings carry fixed interest rates at ~2% for a weighted average term of 2.4 years.

RQI pays $0.08/month, reflecting a 7.7% yield. The REIT industry continues to operate on sound fundamentals, and we expect RQI to experience tailwinds from rate cuts, given its strategic allocation to lucrative sub-sectors with excellent growth potential and predictable rental income.

Pick 2: RVT – Yield 8.7%*

Royce Small-Cap Trust (RVT) is deeply diversified into 483 holdings, with 85% of its portfolio representing U.S.-based companies. Upon examining the sector allocations, we observe that RVT holds a larger position in industrials, materials, financials, and information technology compared to its benchmark index, the Russell 2000.

Turnover rates reflect the percentage of portfolio holdings that experience change over a year. While the S&P 500 has relatively low turnover rates of less than 5%, the Russell 2000 is slightly higher at ~12%. RVT has an estimated turnover rate of 40%, implying an active portfolio management strategy. This has resulted in RVT consistently outperforming its benchmark index.

We also note that RVT does not use leverage in its investment strategy. RVT maintains a policy of paying quarterly distributions at the annual rate of 7% of the rolling average of the prior four calendar quarter-end net asset values. At current price levels, the CEF offers an 8.7% yield, presenting an attractive opportunity to generate income from a segment that trades at modest valuations in a market that is otherwise frothy.

Conclusion

Retirement isn’t a one-time purchase. You don’t pay once and walk away. Expenses don’t stop—and in fact, they tend to grow over time. So your income needs to grow with them.

That’s why a steady, rising stream of cash is essential. Instead of spending down your nest egg, why not make it work for you, paying you, month after month? In this article, we examine RQI and RVT, two closed-end funds (CEFs) that offer reliable income from sectors currently trading at significant discounts. They provide both a margin of safety and consistent cash flow—exactly what income investors seek. That’s the beauty of income investing. That’s the strength of our Income Method.

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