Updated: September 27, 2017
The term closed-end fund (CEF) is a bit of a double entendre. An unintended one, I’m sure – and one we can leverage for safe 6%, 7% and even 8% yields with upside to boot.
The “closed” in CEF technically means that the fund’s number of shares are fixed. Which is why these vehicles can have wild price swings above and below the values of their actual assets. (Good for us contrarian income seekers – we can buy below fair value to maximize our yields and upside.)
They are also closed in their actual communications with the financial world. Fund information is often limited (sometimes to one-page fact sheets) and it’s difficult to get management to talk to you.…