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Friday Fixed Income

Three more CEFs with high yields.

music selection:  “Dead And Bloated” — Stone Temple Pilots

Each Friday, I present three closed end funds invested in debt or debt like securities that are yield rich and attractively priced.  This is a category of my asset allocation I target at 40% of the taxable portfolio.  Importantly, even in today’s low interest rate environment, I am able to meet my entire annual budget and then some with just this 40% of my taxable accounts.  The rest is free to trade, or not trade as market opportunities dictate.  I would never have retired early with such a high withdrawal rate (north of 9%!) had it not been for this safety net.

NexPoint Strategic Opportunities Fund (NHF) is a closed end fund that seeks current income with capital appreciation through investment in floating and fixed rate loans, bonds, debt obligations, mortgage backed and asset backed securities, collateralized debt obligations and equities.  It pays a managed distribution on a monthly basis.

  • Discount to NAV – 11.11%
  • Yield – 10.46%
  • Effective leverage – 14.77%
  • Expense ratio – 2.21%
  • Learn more

Aberdeen Inc. Credit Strategies (ACP) is a closed end fund that seeks a high level of current income with capital appreciation through investing in a portfolio of senior loans.  It pays a income only distribution on a monthly basis.

  • Discount to NAV – 8.04%
  • Yield – 10.56%
  • Effective leverage – 30.07%
  • Expense ratio – 3.11%
  • Learn more

Brookfield Real Assets and Income (RA) is a closed end fund that seeks to achieve its investment objective by investing primarily in Real Asset Companies and Issuers.  It pays a income only distribution on a monthly basis.

  • Discount to NAV – 8.04%
  • Yield – 10.92%
  • Effective leverage – 21.08%
  • Expense ratio – 2.36%
  • Learn more

Devour your prey raptors!

{ 5 comments… add one }
  • MD April 7, 2018, 11:02 am

    Thanks for the great suggestions as always. Would you know if those CEFs are available only to US citizens or anyone who has the permissions enabled in the broker platform?
    Also, are you adding to your portfolio some of those or you stick with what you already have?

    • The Lizard King April 7, 2018, 1:46 pm

      US CEFs should be available to anyone who has permissions enabled. They are very similar to ETFs.

      I’m not currently adding any fixed income exposure as I have about 120% of my annual budget already covered. These picks are where I’d look first if I was going to add more.

  • The Spaniard April 8, 2018, 5:42 pm

    Hi raptor,
    Could you please show us a little more about your insurance and dividend growth companies portfolio? I like very much the idea you put into practice to obtain a fix stream of income through CEF and dividends and the way you use the extra money to trade options.

    Thanks and congrats for your blog it’s being very helpful for me.

    Alberto

    • The Lizard King April 8, 2018, 11:50 pm

      The tIRA account holds: ACGL, AFG, AFL, AGO, AXS, FB, FRFHF, HCI, MKL, MO, NPSNY, RNR, WRB. I don’t really hold many DGI names unless they are for selling covered calls. Have good amounts of MORL and AMZA in the taxable to generate additional distributions beyond the CEFs. Hope that helps.

      • The Spaniard April 9, 2018, 1:19 pm

        It helps a lot, thank you very much!!

        Alberto

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