Updated: June 9, 2020
If you’re shopping for high-yield closed-end funds (CEFs), two numbers are critical:
- The dividend: There are about 500 CEFs out there, and they boast huge payouts of 7% on average. Many also pay monthly.
- The discount: Due to a quirk in the CEF structure, these funds often trade at discounts to the per-share value of their portfolios. Called the discount to net asset value (NAV), this indicator is the clearest indicator of imminent price gains I’ve ever seen in an investment.
A Proven Gain Predictor
Thanks to the discount to NAV—which is available on any fund screener—you literally have a CEF’s market price on a string!… Read more