Three CEFs for your consideration.

music selection:  “Misunderstanding” — Genesis

Each Friday, I present three closed end funds invested in debt and debt like securities that are yield rich and attractively priced.  I keep a 40% allocation to this category and it has served me well.  Current projected 12 month distributions, dividends, and interest on my portfolio meets 112.98% of my budgetary needs.  This is my ‘sleep well at night’ allocation.

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 – 11.71%
  • Yield – 10.44%
  • Effective leverage – 14.77%
  • Expense ratio – 2.21%
  • 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 – 8.42%
  • Yield – 10.71%
  • Effective leverage – 21.08%
  • Expense ratio – 2.36%
  • Learn more

Eaton Vance Tax Advantaged Bond and Income (EXD) is a closed end fund that seeks to provide tax-advantaged current income and gains through the use of a tax-advantaged short-term, high quality bond strategy and a rules-based option overlay strategy.  It pays a managed distribution on a quarterly basis.

  • Discount to NAV – 7.86%
  • Yield – 12.07%
  • Effective leverage – none
  • Expense ratio – 1.45%
  • Learn more

Devour your prey raptors!

Friday Fixed Income

Never miss another opportunity to devour prey!

2 thoughts on “Friday Fixed Income

  • April 13, 2018 at 4:33 pm
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    I wonder how hard it is to find the effective interest rates for leveraged CEFs. To buy them without knowing the cost of the leverage would be like paying points on a mortgage without knowing how much cheaper of an interest rate you’d get.

    I also wonder how the expenses are deducted – from income or from assets.

    Guess I need to read the prospectus.

    Reply
    • April 13, 2018 at 7:59 pm
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      You’d have to read the prospectus like you guessed. For the fixed income CEFs, it is usually deducted from the cash distributions as that is just easier than churning assets.

      Reply

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