New closed end funds.

music selection:  “Bitch Came Back” — Theory Of A Deadman

Each Friday, I explore options in the fixed income space.  When there are no attractive discounted corporate bonds available, I default to highlighting closed end funds invested in income and income like investments that are yield rich and trading at a significant discount to par.  I have two such investments today, plus an update on my limit orders for two discounted bonds that have yet to fill.

Western Asset High Income Fund (HIX) is a closed end fund that seeks high current income through investment in high yield debt securities.  It pays an income only distribution on a monthly basis.

  • Discount to NAV – 11.85%
  • Yield – 8.53%
  • Effective leverage – 26.35%
  • Expense ratio – 0.86%
  • Learn more

MFS Charter Income (MCR) is a closed end fund that seekscurrent income through investment in foreign government bonds, investment grade corporate bonds, mortgage backed securities, high yield corporate bonds, money market securities, emerging market debt and high yield bonds.  It pays a managed distribution on a monthly basis.

  • Discount to NAV – 10.29%
  • Yield – 8.92%
  • Effective leverage – 17.54%
  • Expense ratio – 1.03%
  • Learn more

I have limit orders open on two discounted bonds that I expect to be money good.  These are the Alliance One International (AOI) 9.875 coupon with 15JUL2021 maturity bond at 87 cents on the dollar and the CEC Entertainment (CEC) 8.000 coupon with 15FEB2022 maturity bond at 85 cents on the dollar.  AOI is currently trading at 94.6727 with an indicated yield to maturity of 16.51% and CEC is currently trading at 88.5500 with an indicated yield to maturity 14.48%.  If you are playing the “home game”, do NOT chase these bonds higher than my limit price.  Patience while stalking prey is the raptor way!

Devour your prey raptors!

Friday Fixed Income

Never miss another opportunity to devour prey!

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