Combine Two Powerful Investment Forces into One – Part II

Earlier in the week, we detailed the heavy-handed tax reform that’s hitting virtually every debt-laden Western economy, including here in Australia.

Whether that’s US citizens fleeing California’s wealth tax and taking shelter in neighbouring states, or British citizens departing for tax-friendly locations like Malta.

And as I said, this universal tax grab is aligning precisely with record government debt.

But here’s the reality: it’s happening, and it’s here.

And there’s not much you can do about it other than pack your bags and leave.

That might be possible for some, but for the majority, it’s the system we’re stuck with.

So, it’s time to think about solutions

One idea we looked at was to focus on income-generating assets, such as dividend stocks.

These types of companies may not offer the same capital growth potential, but they offer tax-advantaged income, especially here in Australia, with the added benefit of franking credits.

The main idea behind this is that the aggressive tax regime is targeted squarely at asset growth rather than income.

So, this is one way you could realign your investment strategy.

And here’s the irony: if this becomes a self-reinforcing idea, with investors pivoting towards income-generating assets, then they may start to look more like growth stocks!

But as I said, to fully maximise this strategy, I’d suggest combining two powerful investment themes:

Real asset investments that pay you to hold them.

That could include active miners generating income, royalty stocks that receive a share of that income, energy producers, or companies that generate revenue by servicing these real economies.   

But it might also include utility companies, higher-yielding industrial REITs or infrastructure and engineering stocks.

Yet dividends are just one strategy…

Another angle is to adopt a trader’s mindset.

Given that the incentive to hold assets beyond the one-year CGT discount period is diminishing, short-term buying and selling is becoming more appealing.

Rather than buying and holding and letting the government take a larger slice of that capital gain, you could focus on short-to-medium term moves in the market that make your investments more akin to regular ‘income.’

But to make that work, you need to have niche knowledge about a particular sector.

In my case, that’s junior mining stocks, where I build on my knowledge gained from working on the inside as a geologist.

For my paid readership group, we’ve put that into action, closing on three trades this year with triple-digit gains, plus some solid double-digit winners too.

Of course, that comes with losses as well, which is why you need a trader’s mindset that allows those winning trades to outstrip the losers; in other words, strict risk management strategies.

How it works

To be clear, I’m not talking about day trading or anything like that; I’m referring to moves in the market that tend to take 6 months or so to play out.

One example: You might recall that in late July, we sent out an offer to join my more active trading-focused service. We do that maybe once or twice a year.

The timing of that reopening was deliberate, intended to maximise the potential for a turnaround, particularly in the junior mining sector.

And for those who did join in late July, they’ve benefited from one of the sharpest recoveries across the junior resource market in recent years.

Another example: In late 2025, I recommended several North American oil and gas companies to our premium readership group.

Less than 6 months later, we took profits on several of those O&G positions, including Kodiak Gas Services and Horizon Oil, with gains of 100% or more.

Bottom line: there are always unique ‘tradeable’ opportunities in the resource market, and that’s what our premium subscription aims to hit.

Anyway, it’s just another way I think you should look at investments going forward: focus more on income.

Whether that’s a dividend focus or the quick-fire ‘tradeable’ methodology, like our premium service offers.

Either way, both strategies can be viewed more as ‘regular income’ than as long-term asset accumulation.

And that potentially makes it less susceptible to the wealth-grabbing era that we’re all trying to navigate.

Until next time.