Tag #Closed-End Funds

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forbes.com

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Dec 29, 19:09

Return of Capital in CEFs: A Misunderstood Metric

An analysis of five Nuveen closed-end funds reveals that high return of capital (ROC) percentages, contrary to popular belief, do not necessarily indicate poor performance; actively managed funds may outperform passively managed funds regardless of ROC, and tax implications of ROC should be consider...

Return of Capital in CEFs: A Misunderstood Metric

An analysis of five Nuveen closed-end funds reveals that high return of capital (ROC) percentages, contrary to popular belief, do not necessarily indicate poor performance; actively managed funds may outperform passively managed funds regardless of ROC, and tax implications of ROC should be consider...

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What is the primary takeaway regarding return of capital (ROC) in high-yield closed-end funds, and how does this impact investor decisions?

High-quality closed-end funds (CEFs) often distribute a significant portion of their returns as return of capital (ROC), which is frequently misunderstood. However, in many cases, ROC is advantageous, providing tax-free income for US shareholders and potentially boosting net profits. Five Nuveen funds illustrate this, showcasing varying ROC percentages and performance.

forbes.com

🌐 75% Global Worthiness

Dec 14, 19:08

High-Yield CEF Strategy for Income Investors using International and US Markets

This article proposes a strategy for income investors to leverage high-yield closed-end funds (CEFs), specifically the BlackRock Enhanced International Dividend Trust (BGY) yielding 9.2%, and the China Fund (CHN), to generate higher returns and mitigate risk by rebalancing between US and internation...

High-Yield CEF Strategy for Income Investors using International and US Markets

This article proposes a strategy for income investors to leverage high-yield closed-end funds (CEFs), specifically the BlackRock Enhanced International Dividend Trust (BGY) yielding 9.2%, and the China Fund (CHN), to generate higher returns and mitigate risk by rebalancing between US and internation...

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What are the potential long-term risks and benefits of employing this CEF-based rebalancing strategy, considering the inherent uncertainties in the global economy and the political climate in China?

The article suggests that the current market conditions present a strategic opportunity for income-seeking investors to leverage international CEFs for higher yields and reduced risk compared to traditional ETF strategies. The proposed rebalancing strategy could mitigate the volatility associated with individual stock or market fluctuations while capitalizing on high dividend payouts. The long-term implications of this strategy depend on future economic performance and policy changes in both the US and international markets.

forbes.com

🌐 75% Global Worthiness

Dec 27, 19:10

High CEF Dividend Yields: Sustainability and Tax Implications

Closed-end funds (CEFs) average an 8.7% dividend yield, exceeding the S&P 500's 1.3%, due to trading at a discount to net asset value (NAV) and strategic tax management via 'return of capital' (ROC). High-quality CEFs use ROC to minimize tax burdens on investors' profits, unlike low-quality funds th...

High CEF Dividend Yields: Sustainability and Tax Implications

Closed-end funds (CEFs) average an 8.7% dividend yield, exceeding the S&P 500's 1.3%, due to trading at a discount to net asset value (NAV) and strategic tax management via 'return of capital' (ROC). High-quality CEFs use ROC to minimize tax burdens on investors' profits, unlike low-quality funds th...

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How does the concept of 'return of capital' (ROC) impact the tax liability of CEF investors, and what distinguishes 'good' ROC from 'bad' ROC?

The high yields of CEFs are achievable because they trade at an average 5.8% discount to NAV, and because they utilize strategies to manage tax liabilities for shareholders through 'return of capital' (ROC). While high ROC can sometimes indicate unsustainable payouts, in quality CEFs, it's a tool to minimize the tax burden on investors' profits, as illustrated by GNT's 87% tax-free ROC in 2023 despite a 9.8% NAV return. The key difference lies in how ROC is managed.

Showing 13 to 15 of 15 results