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Looking for Almost $6000 per Year in Passive Income? Invest Just $10,000 in 4 Tariff Sell-Off Bargains
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According to the Internal Revenue Service (IRS), passive income generally includes earnings from rental activity or any trade, business, or investment in which the individual does not materially participate. It can also include income from limited partnerships, stocks, bonds, and other similar enterprises in which the investor is not actively involved. These days, many investors, especially those nearing retirement, seek passive income streams to supplement social security, pension income, or qualified retirement account withdrawals.
24/7 Wall St. Key Points:
- The volatility in the stock market may start to loosen up as trade deals are signed.
- With hedge funds involved in non-stop short selling, many stocks have been hit harder than usual.
- The Nasdaq and the Russell 2000 are both down over 15% in 2025.
- Do you need to start generating some serious passive income? Contact a qualified financial advisor near you for a complete portfolio review today. Click here to get started. (Sponsored?)
After a brutal first quarter and a weak start to the second quarter, many investors are shell-shocked by the size and volume of trading. With soaring volumes and massive 1000-point moves in both directions, it’s hard to know where to move next on the Wall Street chess board. The good news is while the battle on tariffs has always been about evening the score with China, the White House, according to reports, has been in touch with 70 countries looking for deals, and as many as 15 are already being negotiated.
Given the recent positive reports and some stellar earnings from the big money center banks to start the first quarter earnings season, it may be time for growth and income investors to get to some of their dry powder. We screened our 24/7 Wall Street ultra-high-yield dividend stock research database and found four stocks that have been hammered and are offering some cheap entry points. Investors putting $10,000 in each will generate a solid $5,875 per year in passive income.
Why do we cover ultra-high-yield stocks?
While not suited for everybody, those trying to build strong passive income streams can do exceptionally well with some of these top companies in their portfolios. Paired with more conservative blue-chip dividend giants, investors can employ a barbell approach to generate substantial passive income streams.
Blackrock TCP Capital
Run by arguably the biggest money manager in the world, this company pays a giant dividend. Blackrock TCP Capital Corp. (NASDAQ: TCPC) is a business development company specializing in direct equity and debt investments in:
- Middle-market, small businesses
- Debt securities
- Senior secured loans, junior loans, originated loans
- Mezzanine
- Senior debt instruments
- Bonds and secondary-market investments
It typically invests in:
- Communication services
- Public relations services
- Television
- Wireless telecommunication services
- Apparel, textile mills
- Restaurants, retailing
- Energy, oil, and gas extraction
The company also prefers to invest in:
- Patent owners and Lessors
- Federal and Federally- Sponsored Credit Agencies
- Insurance, hospital, and healthcare centers
- Biotechnology
- Engineering services
- Heavy electrical equipment
- Tax accounting,
- Scientific and related consulting services for freight air transportation
- Information technology consulting, application hosting services, software diagram and design, computer-aided design, communication equipment, electronics manufacturing equipment, computer components
- Chemicals
It seeks to invest in the United States. The fund typically invests between $10 million and $35 million in companies with enterprise values between $100 million and $1500 million, including complex situations. It prefers to make equity investments in companies for an ownership stake.
Investing $10,000 at recent trading levels would buy 1495 shares. Paying $1 per year in dividends will produce $1495 in income.
Ellington Financial
Ellington has been at the forefront of data-driven investing since its founding in 1994. This quality mortgage REIT company is a favorite across Wall Street and pays a massive dividend. Ellington Financial Inc. (NYSE: EFC), through its subsidiary, Ellington Financial Operating Partnership LLC, acquires and manages mortgage-related, consumer-related, corporate-related, and other financial assets in the United States.
The company develops and manages residential mortgage-backed securities (RMBS) backed by:
- Prime jumbo
- Alt-A, manufactured housing, and subprime residential mortgage loans
- RMBS for which the principal and interest payments are guaranteed by the U.S. government agency or the U.S. government-sponsored entity
- Residential mortgage loans
- Commercial mortgage-backed securities
- Commercial mortgage loans and other commercial real estate debt
Ellington Financial also provides collateralized loan obligations, mortgage-related and non-mortgage-related derivatives, corporate debt and equity securities, corporate loans, and other strategic investments. The company offers consumer loans and asset-backed securities backed by consumer and commercial assets.
$10,000 buys 867 shares, which pay $1.56 per share each year. That equals $1352 in passive income every year.
FS KKR
FS KKR is a publicly traded BDC that provides customized credit solutions to private middle-market U.S. companies. This well-known name on Wall Street offers a solid entry point at current levels and pays a massive dividend. FS KKR Capital Corp. (NASDAQ: FSK) is a business development company specializing in investments in debt securities. It seeks to purchase interests in loans through secondary market transactions or directly from the target companies as primary market investments.
The company also seeks to invest in:
- First-lien senior secured loans
- Second-lien secured loans
- Subordinated loans
- Mezzanine loans
The firm also receives equity interests, such as warrants or options, in connection with debt investments for additional consideration. It seeks to purchase minority interests in common or preferred equity in our target companies, either in conjunction with one of the debt investments or through a co-investment with a financial sponsor.
The fund may invest in corporate bonds and similar debt securities opportunistically.
The fund does not seek to invest in start-ups, turnaround situations, or companies with speculative business plans. It aims to invest in small and middle-market companies in the United States.
FS KKR seeks to invest in firms with annual revenue between $10 million and $2.5 billion. It aims to exit from securities by selling them in a privately negotiated over-the-counter market.
$10,000 will purchase 535 shares at current prices. Each share will pay $2.80 per year in dividends for $1498.
Mach Natural Resources
Mach Natural Resources is an independent upstream oil and gas company that acquires, develops, and produces oil, natural gas, and NGL. This 2023 IPO is trading well below the initial public offering price. Mach Natural Resources (NYSE: MNR) conducted a secondary offering earlier this year to purchase more producing assets.
The company is an independent upstream oil and gas company focused on acquiring, developing, and producing oil, natural gas, and natural gas liquids reserves in the Anadarko Basin region of Western Oklahoma, southern Kansas, and the Texas panhandle.
The analysts at Raymond James noted that Mach is led by Tom Ward, Co-Founder of Chesapeake Energy. Mach is another entrant into the E&P MLP space. It is a pure-play operator in the Anadarko Basin, leveraging its strong position (1 million net acres) to become the primary consolidator in the region.
Mach’s midstream position and lower base decline (~20%) allow the company to target a lower reinvestment rate (~30%) relative to the overall industry. In addition, it is one of the only exploration and production companies organized as a limited partnership as it is an oil and gas producer.
At current levels, $10,000 would buy 765 shares. Paying out $2 per share yearly in dividends would generate $1530 in passive income.
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