Closed End Funds List: 20 Must-Know Options for Savvy Investors

Closed-end funds (CEFs) are a unique type of investment vehicle that offers a range of benefits and potential drawbacks. To help you navigate the CEF landscape, we present a comprehensive list of 20 high-quality offerings, each with its distinct characteristics and investment strategies.

Understanding Closed-End Funds

CEFs are publicly traded funds that raise capital once and invest it in a specific portfolio of assets. Unlike open-end funds, which can issue and redeem shares continuously, CEFs have a fixed number of shares outstanding. This structure often leads to CEFs trading at a premium or discount to their net asset value (NAV).

Benefits of Closed-End Funds

• Leverage: CEFs can use leverage to enhance returns, providing higher yields or capital appreciation potential.
• Income generation: Many CEFs focus on income-producing assets, such as bonds, preferred stocks, or real estate, offering regular distributions to investors.
• Access to unique strategies: CEFs often invest in niche markets or employ specialized investment techniques, allowing investors to diversify their portfolios.

Potential Drawbacks

• Pricing inefficiencies: CEFs can trade at a premium or discount to NAV, potentially impacting returns.
• Liquidity issues: CEFs may have limited liquidity, especially for less popular funds, resulting in wider bid-ask spreads.
• Management fees: CEFs typically have higher management fees than open-end funds, potentially reducing returns.

Top 20 Closed-End Funds

#1. Nuveen Preferred & Income Securities Fund (JPS)
* Invests in a diversified portfolio of income-producing preferred stocks and other securities.
* High current yield (around 6%).
* Long-term performance: NAV has increased by over 100% since inception.

#2. Cohen & Steers Quality Income Realty Fund (RQI)
* Focuses on high-quality real estate investment trusts (REITs) in various sectors.
* Stable dividend yield (around 4%).
* Strong historical performance: NAV has outperformed the S&P 500 over the past 10 years.

#3. BlackRock Multisector Income Trust (BIT)
* Invests in a diversified portfolio of bonds, preferred stocks, and other debt instruments.
* High yield (around 7%).
* Relatively low volatility compared to other CEFs.

#4. PIMCO Dynamic Income Fund (PDI)
* Uses a dynamic investment strategy to invest in various income-producing assets.
* High current yield (around 9%).
* Potential for substantial capital appreciation in bull markets.

#5. Ares Capital Corporation (ARCC)
* A business development company (BDC) that provides loans to small and medium-sized businesses.
* High dividend yield (around 8%).
* Exposure to private credit markets.

#6. KKR Income Opportunities Fund (KIO)
* Invests in private credit, real estate, and other alternative investments.
* High yield (around 10%).
* Potential for high returns but also higher risk.

#7. Eaton Vance Tax-Advantaged Dividend Income Fund (ETO)
* Focuses on tax-efficient income stocks, such as dividend-paying companies and MLPs.
* High current yield (around 9%).
* Potential tax benefits for certain investors.

#8. General American Investors Company (GAM)
* Invests in a portfolio of common and preferred stocks, primarily in the financial services and energy sectors.
* High dividend yield (around 8%).
* Long track record of paying dividends.

#9. Aberdeen Emerging Markets Equity Fund (AFE)
* Provides exposure to emerging markets stocks in various countries.
* High growth potential.
* Currencies and political risks.

#10. T. Rowe Price Global Stock and Income Fund (GSIX)
* Invests in global stocks with an emphasis on income and capital appreciation.
* High current yield (around 4%).
* Exposure to international markets.

#11. Nuveen Real Estate Income Fund (JRE)
* Focuses on a diversified portfolio of REITs and other real estate-related investments.
* Stable dividend yield (around 4%).
* Potential for long-term capital growth.

#12. BlackRock Limited Duration Income Trust (LDI)
* Invests in short-term bonds and other fixed-income instruments.
* Low volatility and higher current yield than traditional bond ETFs.
* Potential for capital preservation in rising interest rate environments.

#13. Western Asset High Income Fund (HIX)
* Invests in a diversified portfolio of high-yield bonds and other debt instruments.
* High current yield (around 9%).
* Potential for high returns but also higher risk.

#14. AllianzGI Convertible & Income Fund (NCV)
* Invests in a portfolio of convertible bonds and other hybrid securities.
* Potential for income and moderate capital appreciation.
* Volatility can be higher than traditional bond funds.

#15. Fidelity High Income Fund (FHI)
* Invests in a diversified portfolio of high-yield bonds and other debt instruments.
* High current yield (around 10%).
* Potential for high returns but also higher risk.

#16. VanEck Vectors CEF Municipal Income Fund (XMPT)
* Provides exposure to municipal bonds through a CEF structure.
* Tax-free income for eligible investors.
* Lower volatility than taxable bond funds.

#17. John Hancock Tax-Advantaged Dividend Income Fund (HTD)
* Focuses on tax-efficient income stocks, such as dividend-paying companies and MLPs.
* High current yield (around 9%).
* Potential tax benefits for certain investors.

#18. BlackRock Corporate High Yield Fund (HYT)
* Invests in a diversified portfolio of high-yield corporate bonds and other debt instruments.
* High current yield (around 8%).
* Potential for high returns but also higher risk.

#19. Liberty All-Star Equity Fund (USA)
* Invests in a portfolio of large-cap growth and value stocks.
* High total return potential.
* Potentially higher volatility than other CEFs.

#20. Nuveen S&P 500 Dynamic Overwrite Fund (SPXX)
* Uses an options strategy to enhance returns on the S&P 500 index.
* High current yield (around 8%).
* Potential for additional capital appreciation through options premiums.

Conclusion

Closed-end funds offer a range of unique attributes and investment opportunities. By carefully evaluating their characteristics, investors can identify CEFs that align with their financial goals and risk tolerance. The list provided in this article serves as a starting point for exploring this diverse asset class and potentially enhancing your investment portfolio.