perrytime
Recycles dryer sheets
CEF that kept dividend same since 2002, It just dropped dividend, at 13.80 about a %10 yield now, and I hope some upside in price over next few years. Still has a premium to NAV, but not out rageious in my opinion.
Never thought I'd see someone complaining about buying a dollar for 90 cents.
Discounts generate a bit of risk free yield, which I am happy to take if you don't want it. Heck, I know one CEF that is a fund of funds trading at like a combined 17-18% discount. If you don't want that, I'll take some. Key question regarding the fees which are typically amplified by their use of leverage and financing costs is, is it worth it after expenses?
ETF's can't use leverage. ETF's typically have lower yields and no discount opportunities.
Now we have the opposite opinion, all 500+ CEF's are terrible investments...
CEFs have no linkage to the real NAV.
That isn't true at all. Many studies support strong mean reversion in CEF's and they even have the Z stat as a measure of relative vs historical valuation.
Exploiting Closed-End Fund Discounts: The Market May Be Much More Inefficient than You Thought by Dilip K. Patro, Louis R Piccotti, Yangru Wu :: SSRN
Evidence on the Mean-Reverting Tendencies of Closed-End Fund Discounts by Dominic Gasbarro, Richard David Johnson, J. Kenton Zumwalt :: SSRN
They usually have very high fees and trade at discounts.
Never thought I'd see someone complaining about buying a dollar for 90 cents. Discounts generate a bit of risk free yield, which I am happy to take if you don't want it. Heck, I know one CEF that is a fund of funds trading at like a combined 17-18% discount. If you don't want that, I'll take some. Key question regarding the fees which are typically amplified by their use of leverage and financing costs is, is it worth it after expenses?
ETF's can't use leverage. ETF's typically have lower yields and no discount opportunities.