The coronavirus caused a correction on the ASX this week, meaning the ASX share market dropped 10%. It was one of the most painful weeks ever on the ASX.
But I believe we're being presented with better priced opportunities. Shares have been expensive recently because of low interest rates. Now they're less expensive.
One of the benefits of a lower share price is that it boosts the prospective dividend yield, assuming the dividend isn't cut.
These dividend shares now have a dividend yield of 10% or more:
Naos Emerging Opportunities Company Ltd (ASX: NCC)
The small cap focused listed investment company (LIC) looks at shares with market capitalisations under $250 million. It likes to have a high-conviction portfolio of only around 10 names.
In times like this it's small caps that have been hurt the most. Since Monday the Naos share price has dropped 10%. This has boosted the trailing grossed-up dividend yield to 10.4%.
Since it started paying a dividend in the second half of FY13 it has grown its dividend each year to FY18 and has maintained the dividend since.
The LIC is able to turn capital gains and dividends received into dividends for its own shareholders, though an absolute share crash could deplete the LIC's profit reserve.
WAM Research Limited (ASX: WAX)
This is another LIC, so it has the same ability to pay dividends from its investment returns. Over the past decade WAM Research has been one of the best-performing LICs with a focus on smaller shares with a lot of growth potential. Geoff Wilson and the Wilson Asset Management (WAM) investment team have performed very well.
WAM Research has seen its share price fall around 10% this week. This has pushed its grossed-up dividend yield to 10%.
It has grown its dividend every year since GFC and the previous strong investment returns will hopefully keep slowly growing the dividend.
Foolish takeaway
Both of these businesses now offer very large dividend yields thanks to today's market fall. High yield isn't my main aim, so I'm not looking to these two LICs today. But for brave income-seekers it could be a good time to be opportunistic.
