CEF Holdings ---- April 2026

[dickoncapecod]

Here is the chart:

View attachment 62912

If I did my math right, that's the equivalent of 53+ million shares of SPY. Stress those shorts and equities could pop up very nicely.
Regards, Dick

 

[FlyingCircus]

I doubt any market direction could be predicted, given the unpredictability of actions, statements and reactions relating to the Middle East at present.
FC

 

[dickoncapecod]

The week ended 4/10 was a good one for most bondish CEFs. Most made modest gains instead of giving back part of the previous week's large advances. But while daily MACDs are on strong buy signals, slower-reacting weekly MACDs remain negative. Technicals are the same for portfolio component ETFs HYG LQD MBB, but it is noteworthy that HYG put in a 3-year high before backing off a few cents to close the week.

Under the hood, 800 to 1100 basis points below CEF yields, not much changed. Fed funds futures are basically flat, reflecting expectations of no change in Fed policy in 2026. The year bill one year forward is 3.93%, and although inflation breakevens are modestly elevated, Fed favorite 5 yr inflation 5 years forward remains at a benign 2.13%.

Currently, the only real drivers of bond and equity prices are war developments and related crude oil prices. After watching crude rise to around $100, market participants were not surprised to see CPI headline up 0.9% or consumer sentiment hit an all-time low. Personal income FELL 0.1% ---a rare occurrence--- while spending continued at a strong pace. Associated inflation data was pre-war, but nonetheless REAL income actually FELL 0.5%! Next week will bring more "shocking" inflation news, with PPI expected up 1.2% and core +0.5%. Finally, import/export prices are forecast +2.1%/+1.7%. And we have no idea what daily developments will arise regarding the war, negotiations, and the Straight of Hormus.

My view: I'm fully invested in income CEFs again because their prices and yields are quite close to those seen when Fed funds were 5,25+% and inflation briefly around 9%. Nothing is certain, but it's hard to imagine a cushion larger than that. Equities, of course, have different price drivers.and are far-far-far higher than their old distress lows. Bottom line: Q4 GDP was 0.4% and Q1 GDP predictions are declining rapidly, many estimates already below 2%. As predicted, the war and associated energy price increases appear to be stagflation generators. Further, high energy prices and their economic impact will not suddenly revert to pre-war levels when the fighting. stops ---- they will have long tails. Being new Fed Chair Kevin Warsh will be less fun that earlier imagined.
Regards, Dick

 

[DrVenture]

^^^ I take this to read that you are more bullish on these bondish CEFs than equities @dickoncapecod ?

Edit: "bondish" due to autocorrect.

 

[dickoncapecod]

^^^ I take this to read that you are more bullish on these boyish CEFs than equities @dickoncapecod ?

Hi. I have never understood the stuff that drives equity prices, so my view is probably overly simple. I just observe that bondish CEFs appear priced for a large blast of energy-based inflation while stocks are 30 to 40%(?) higher than the 3 years- past inflation/interest rate stress point.
Regards, Dick

 

[dennis5502]

Hi. I have never understood the stuff that drives equity prices, so my view is probably overly simple. I just observe that bondish CEFs appear priced for a large blast of energy-based inflation while stocks are 30 to 40%(?) higher than the 3 years- past inflation/interest rate stress point.
Regards, Dick

I usually maintain about 40% equities in my taxable portfolio. However, with equities at high prices with bondish CEFs at low prices/high distributions, I have lowered equities selectively to 25-30% of the portfolio after reading the excellent article at Pimco’s website entitled “Layered Uncertainty …”. See especially the Figure 4 graphs comparing equities to bond prices. As Dick lays out, a current portfolio of high yield bonds in iras is hard to beat. I track daily the nav price vs market price and note most of the well known CEFs are taking advantage of the low prices to upgrade portfolios. Hence, I have 100% CEFs in my ira, while I have 25-30% stocks with about 40% cash/treasuries/ 25-30% CEFs in my taxable account. Dennis

 

[DrVenture]

I have been of the mind that FI would potentially outpace equities in 2026. Much of what is being said above seems to support that. I too have lowered my equity exposure significantly. Because I have equities in both taxable and non-taxable, I usually lower equity in tax-advantaged accounts to avoid cap gains events in taxable.

As I want to begin adding back some risk, I want to do that in the right areas. FI is currently my first choice. CEFs seem to fit my needs at this time (beginning retirement). Possibly I will add some select stock positions, as well.

 

[Steelpony]

I usually maintain about 40% equities in my taxable portfolio. However, with equities at high prices with bondish CEFs at low prices/high distributions, I have lowered equities selectively to 25-30% of the portfolio after reading the excellent article at Pimco’s website entitled “Layered Uncertainty …”. See especially the Figure 4 graphs comparing equities to bond prices. As Dick lays out, a current portfolio of high yield bonds in iras is hard to beat. I track daily the nav price vs market price and note most of the well known CEFs are taking advantage of the low prices to upgrade portfolios. Hence, I have 100% CEFs in my ira, while I have 25-30% stocks with about 40% cash/treasuries/ 25-30% CEFs in my taxable account. Dennis

We only hold NEA in a taxable account which distributes around 7%+ tax free. I’m leaning towards a taxable CEF which would net more even after taxes.

I do see others hold some in a taxable account occasionally when they do a monthly listing. Otherwise I assumed for most they’re in a ROTH or TIRA.

If I read this correctly are your CEFs munis, tax favored etc. in your taxable account? Thanks.

 

[IncomeOriented]

We only hold NEA in a taxable account which distributes around 7%+ tax free. I’m leaning towards a taxable CEF which would net more even after taxes.

I do see others hold some in a taxable account occasionally when they do a monthly listing. Otherwise I assumed for most they’re in a ROTH or TIRA.

If I read this correctly are your CEFs munis, tax favored etc. in your taxable account? Thanks.

I hold pimco’s and GOF in taxable accounts. I would rather have 12%+ “partially taxable” than ~7% muni federal only tax free.

Partially taxable - not everything received from the CEFs are taxed. Some of the dividends ( not much usually) are qualified. Some are classified as roc. GOF for example is usually 50-70% roc

Muni’s are federally tax free- that’s great but live in a small state, and I have to pay state income taxes on the municipal dividends. Plus the muni income can sometimes increase the taxation on social security. Considering the substantially lower rate on muni’s, I prefer to pass on them.

 

[Steelpony]

I hold pimco’s and GOF in taxable accounts. I would rather have 12%+ “partially taxable” than ~7% muni federal only tax free.

Partially taxable - not everything received from the CEFs are taxed. Some of the dividends ( not much usually) are qualified. Some are classified as roc. GOF for example is usually 50-70% roc

Muni’s are federally tax free- that’s great but live in a small state, and I have to pay state income taxes on the municipal dividends. Plus the muni income can sometimes increase the taxation on social security. Considering the substantially lower rate on muni’s, I prefer to pass on them.

Well I’m set in a TIRA compounding at high rates when I can and came to the same conclusion a while ago as you.

I was hoping a like minded investor who doesn’t freak out about taxes and ROC might respond, lol.

I did this already with my parents portfolio as they aged through independent living (8 yrs) assisted living (7 years) and LTC ( 3+ years). I had to spend down the last year or so.

The flaw in my opinion which my patents wouldn’t let me address when they were in their mid sixties was a long held equity type holding as further back up and/or feeder for CEF investments if needed. I use VTI for us as a set aside.

 

[dennis5502]

We only hold NEA in a taxable account which distributes around 7%+ tax free. I’m leaning towards a taxable CEF which would net more even after taxes.

I do see others hold some in a taxable account occasionally when they do a monthly listing. Otherwise I assumed for most they’re in a ROTH or TIRA.

If I read this correctly are your CEFs munis, tax favored etc. in your taxable account? Thanks.

My taxable account CEFs are two Nuveen amt free munis, four preferred stock funds, two covered call funds, and three high yield bond funds. Dennis

 

[IncomeOriented]

My taxable account CEFs are two Nuveen amt free munis, four preferred stock funds, two covered call funds, and three high yield bond funds. Dennis

Are your preferred giving you a lot of qualified dividends? and Are the covered calls giving lots of roc tax benefits?

Recently I switched my preferred cef paying 8% dividend and 90% of that was qualified; and moved it to PIMCOs paying 12%+. I did the same on my covered calls cefs. In my case I believe I will get a higher net return after tax.

 

[IncomeOriented]

Well I’m set in a TIRA compounding at high rates when I can and came to the same conclusion a while ago as you.

I was hoping a like minded investor who doesn’t freak out about taxes and ROC might respond, lol.

I did this already with my parents portfolio as they aged through independent living (8 yrs) assisted living (7 years) and LTC ( 3+ years). I had to spend down the last year or so.

The flaw in my opinion which my patents wouldn’t let me address when they were in their mid sixties was a long held equity type holding as further back up and/or feeder for CEF investments if needed. I use VTI for us as a set aside.

Wow! Paying for 18 years of care is an amazing amount of money! You did very well by them.

Are you saying your parents wouldn’t let you put some money into VTI type holdings back then ?

 

[dickoncapecod]

Are your preferred giving you a lot of qualified dividends? and Are the covered calls giving lots of roc tax benefits?

Recently I switched my preferred cef paying 8% dividend and 90% of that was qualified; and moved it to PIMCOs paying 12%+. I did the same on my covered calls cefs. In my case I believe I will get a higher net return after tax.

I've a always been amazed that so many folks (clearly not you) suffer tax-phobia and make poor income investment decisions. Ignoring the marketing-department muni CEF lures that purposefully distribute large amounts of destructive ROC to appear competitive with peers, some good muni CEFs yield 5.5% to 6.5%. Consider taxable equivalents to 6%...
22% bracket 6% tax free = 7.69% taxable
28% = 8.33% taxable
40% = 10% taxable
Bottom line: only folks with very high marginal tax rates even approach the 11-15% after-tax income available from PIMCO and many other taxable CEFs.
Regards, Dick

 

[DrVenture]

In context of the above (very interesting & potentially helpful) conversation, If one currently in the high 22% (or even 24%) bracket, wanted to purchase a CEF in a taxable account, what would be a couple good recommendations.

I also never saw the advantage of muni type funds at my tax level, FWIW.

 

[dickoncapecod]

In context of the above (very interesting & potentially helpful) conversation, If one currently in the high 22% (or even 24%) bracket, wanted to purchase a CEF in a taxable account, what would be a couple good recommendations.

I also never saw the advantage of muni type funds at my tax level, FWIW.

Look above and at earlier monthly CEF Holdings threads ---- you'll find that a group of investors who read and do research and enjoy managing their own portfolios --- often for many years/decades --- have settled in on a surprisingly small population of bondish income CEFs. Consider leveraging their experience and research to identify some good candidates.
Regards, Dick

 

[Steelpony]

Wow! Paying for 18 years of care is an amazing amount of money! You did very well by them.

Are you saying your parents wouldn’t let you put some money into VTI type holdings back then ?

My parents were from the Depression era but a frugal lifestyle made them well off for their generation.

Skipping a lot of details at the start, I asked if they wanted to put money aside for later life issues if they arise? The answer was no. Spend down or income? The answer was income. Questions like that.

Anyway once I got an idea what they wanted at the end I went back to the set aside as backup. No again.

So yes I was really stuck with all my eggs in one basket. So through an apartment, independent living (my dad passed there) assisted living and in the end LTC at 10k a month. I winged it with all CEF’s and eventual forced spend down. The period was 1982-2017. My mom lived to 99 and ran out of money about 8 months before. My dad had a 17 year retirement my mom 35 years.

 

[Steelpony]

Look above and at earlier monthly CEF Holdings threads ---- you'll find that a group of investors who read and do research and enjoy managing their own portfolios --- often for many years/decades --- have settled in on a surprisingly small population of bondish income CEFs. Consider leveraging their experience and research to identify some good candidates.
Regards, Dick

Being married and not needing any more income for now I‘m on board with CEF’s in a taxable account when needed. I used them with my mother for assisted living and LTC.

I have a set aside that can be converted to CEF’s if ever needed. In my experience in addition to the reliable income the narrower bond like value swings slowed spend down for her LTC.

My biggest hang up is the doubling of taxes for a single person especially if I pass first. I know the net will still be higher but my wife won’t.

Basically I’m gradually investing more to needs only and keeping more and more dry powder for some wiggle room (ready cash in a taxable account held in SGOV) in addition to the set aside. I continue to monitor assisted living and LTC costs where my mother was and comparing that to what I set aside.

Depending on how this unknown all plays out both of use have options.

 

[IncomeOriented]

My parents were from the Depression era but a frugal lifestyle made them well off for their generation.

Skipping a lot of details at the start, I asked if they wanted to put money aside for later life issues if they arise? The answer was no. Spend down or income? The answer was income. Questions like that.

Anyway once I got an idea what they wanted at the end I went back to the set aside as backup. No again.

So yes I was really stuck with all my eggs in one basket. So through an apartment, independent living (my dad passed there) assisted living and in the end LTC at 10k a month. I winged it with all CEF’s and forced spend down. The period was 1982-2017. My mom lived to 99 and ran out of money about 8 months before. My dad had a 17 year retirement my mom 35 years.

All things considered, you got amazing mileage with their CEFs. And you were able to honor your parents feelings and wishes and make it work for them. And you helped them made it work for them for so many years. You are the definition of a faithful family steward.

 

[DrVenture]

I hold pimco’s and GOF in taxable accounts. I would rather have 12%+ “partially taxable” than ~7% muni federal only tax free.

Partially taxable - not everything received from the CEFs are taxed. Some of the dividends ( not much usually) are qualified. Some are classified as roc. GOF for example is usually 50-70% roc

Muni’s are federally tax free- that’s great but live in a small state, and I have to pay state income taxes on the municipal dividends. Plus the muni income can sometimes increase the taxation on social security. Considering the substantially lower rate on muni’s, I prefer to pass on them.

Are there any specific Pimco CEFs that are better suited for a taxable account? We also pay state tax on munis where we live.

 

[COcheesehead]

Are there any specific Pimco CEFs that are better suited for a taxable account? We also pay state tax on munis where we live.

One consideration is ROC is not taxable as income so a fund that has return of capital provides an advantage if in taxable. It will reduce your cost basis so if you sell capital gains may apply.

 

[dickoncapecod]

Are there any specific Pimco CEFs that are better suited for a taxable account? We also pay state tax on munis where we live.

IMO yes, the highest yielding ones. Perhaps I misunderstand what you are trying to get at, but if the after tax percentage is what you keep, obviously (say) 78% of $10,000 is better than 78% of $7,000.
Regards, Dick

 

[Steelpony]

@IncomeOriented Thanks again. It’s an old school ethic.

In my state NEA is triple tax exempt and TIRA withdrawals are still state tax free. My tax equivalent yield is near 9%.

As an aside I googled this for laughs:

If I have 200k in closed end fund income per year plus SS with substantial cash savings and my needs at 85 (which is not me but I figured later life) are 20k a year with the rest reinvested at high rates what is my downside?

Believe it or not there’s a list. 🫩

 

[stefansm]

I've a always been amazed that so many folks (clearly not you) suffer tax-phobia and make poor income investment decisions. Ignoring the marketing-department muni CEF lures that purposefully distribute large amounts of destructive ROC to appear competitive with peers, some good muni CEFs yield 5.5% to 6.5%. Consider taxable equivalents to 6%...
22% bracket 6% tax free = 7.69% taxable
28% = 8.33% taxable
40% = 10% taxable
Bottom line: only folks with very high marginal tax rates even approach the 11-15% after-tax income available from PIMCO and many other taxable CEFs.
Regards, Dick

This is very helpful!

Holding muni CEFs in a taxable account, for income purposes, as opposed to bondish CEFs, seems like a missed opportunity to get more income

This doesn't mean munis, as an asset class, can't play a role in your portfolio. It depends on everyone's portfolio size and construction and taxable/non-taxable (IRA) allocation.

In my case, I hold a (relatively high) allocation to individual munis, AAA-AA, in my taxable accounts. They yield 4% on average and are pulled to par on expiration/call dates.

These muni bonds act as volatility stabilizer for my portfolio, as cash equivalent when opportunities in risk assets show up and lower my tax bracket.

 

[joejetski]

Are there any specific Pimco CEFs that are better suited for a taxable account? We also pay state tax on munis where we live.

Not a recommendation, but there are some muni CEFs that are “double” tax free. For example, NPV is federal and state tax free for VA residents. It’s yield is 7 and change.