High-yield investments, meaning high single digits or higher, tend to come from a small handful of investment types: real estate investment trusts—especially finance REITs— business development companies (BDCs), energy midstream companies, preferred stocks, and closed-end funds (CEFs) with managed dividend policies.
These assets tend to move together. Higher interest rates are usually a negative. Most are also tied to the stock market’ s ups and downs. My Dividend Hunter newsletter offers a portfolio of recommended high-yield investments. I am always on the hunt for yields from a different asset type or strategy.
In April, some of the management team from Simplify ETFs joined our subscribers for a live webinar to discuss a few of their exchange-traded funds . Simplify specializes in offering ETFs that invest in a wide range of alternative assets.
The Simplify managers discussed the Simplify Currency Strategy ETF (FOXY) as an alternative in the high-yield space. I dug into the fund, agreed with them, and added it to my Dividend Hunter portfolio.
Here is the fund’s description from the Simplify website:
”The Simplify Currency Strategy ETF (FOXY) seeks capital gains by taking long and short positions in foreign currencies. Returns are expected to be generated through the combination of a “carry” strategy applied to emerging market currencies combined with a mean-reversion strategy applied to G10 currencies.
The goal is to generate an independent source of returns with low correlations to stocks and bonds, thus making the fund an effective portfolio diversifier.”
This is not a currency trading fund. The carry strategy involves buying a higher-yielding currency and short selling a lower-yielding one to earn the difference between the rates. The trade requires very little capital, so the ETF can leverage currency exposure and returns.
Since it launched in February 2025, through September 30, FOXY returned 21%, or 12.2% annualized. Dividends are paid monthly, with a current distribution rate of 10.3%.
Here is the share price chart since FOXY launched, compared to the iShares Preferred and Income Securities ETF (PFF). PFF is the largest index-tracking ETF for preferred stocks. You can see how rising rates have hurt PFF’s share price, while FOXY has posted a positive return.
With interest rates moving higher, it’s good to have something like FOXY in your brokerage account.
Taxing Your Unrealized Gains is Back on the Table
The last time Democrats ran things a certain congresswoman from the Bronx pushed hard to begin taxing unrealized gains on investment accounts. That means if any of your shares ran up, you'd pay a tax on them even if you don't sell them. This was positioned to get money from the ultrarich, but you know it will work its way down to regular investors like us.
Tim Plaehn's Freedom Number income strategy allows you to avoid this altogether while collecting double digit dividends, week in and week out.
Learn how to get started and protect your money before the new Congress is sworn in.
