When facts change, so must my opinion. I was critical of governance at Macquarie Global Infrastructure Total Return Fund (MGU) last June. Investors don't expect swift changes from diversified global infrastructure vehicles like MGU or the iShare, S&P Global Infrastructure Index Fund (IGF). Much has changed in ten months though. When facts change, so must my opinion. Looking forward, MGU's attributes make it significantly more attractive for long term investors than IGF. Its much more than the new yield and recent performance. Excess supply has been removed, which the market is not reflecting.

What is the Asset Class?

As "Global Infrastructure" funds, MGU and IGF are alternate choices for yield-oriented investors who desire Energy, Industrials, and Utilities exposure both in the US and abroad. At Wednesday's closing prices, MGU yields 6% and IGF 3.86%. MGU trades at roughly a 10% discount to its Net Asset Value ("NAV") and is among

It has been thirty one months since I first covered Alpine Total Dynamic Dividend Fund (AOD) and Alpine Global Dynamic Dividend Fund (AGD). Within days the 30%+ market premiums over Net Asset Value ("NAV") had fully collapsed. Still, the impetus was not my article.

Regardless who anticipated it, the impetus was a monstrous distribution cut. In 2010 the monthly distribution (technically "earned" by virtue of a hyper-velocity Dividend Capture Rotation Strategy) had previously created investor illusions as to expected earnings. Technically "earned" or not, the funds' Boards started dramatically cutting its monthly distribution in mid 2010.

Having closed at a 31.63% premium on June 21st 2010, AOD closed at more than a 4% discount just four calendar days later. AGD went from a 38.43% premium on June 18th 2010 to a discount over ten calendar days.

Perhaps the Board of Trustees at Alpine remembers how quickly the market reacted

Things sometimes get pretty bad before activism appears not only viable but likely at Closed End Funds. An ever-developing picture looks to fit an investing style I study closely: Well Intentioned Closed End Fund Activism.

A dramatically reduced $8 offering price in SolarCity (SCTY) last evening is the latest "black eye" affecting shareholders of Kevin Landis' Business Development Company, The Firsthand Tech Value Fund (SVVC). The SCTY IPO was filed for the $13-$15 range but priced at $8. SVVC was valuing its pre-IPO investment at $17.22 per share, with 2% annualized fund management expenses accruing at the higher valuation. At the end of November, SCTY was SVVCs third largest (non-cash) holding.

Unfortunate pre-IPO investments and offerings appear nothing new for SVVC. SVVC was a pre-IPO investor and yet its cost basis for Facebook (FB), its largest holding, was $31.50. SVVC actually conducted its own unfortunate $118,800,000 stock offering

In the last nine weeks, I covered why Greater China Fund's (GCH) proposed New Advisory Agreement proposal could not pass without a liquidity event, and the collective conditions which made a merger into The JF China Region Fund (JFC) less likely than a GCH-independent liquidity event. This week we learned that critical mass liquidity will be made available to all desiring shareholders as a condition for approving the same Advisory Agreement at a rescheduled vote on January 8th.

Mr. Market revalued GCH Tuesday as now appearing as an arbitrage trade, up 4% with China (FXI), Hong Kong (EWH) and Taiwan (EWT) all lower alongside our domestic market. The relative valuation change appears highly sensible. GCH is now readily perceived as an arbitrage opportunity.

Advisor Approval and Tender or Liquidation

The City of London ("COL") proxy is to mirror-vote (same proportion for/against) other shareholders, more or less assuring

I recently wrote about why a November 1, 2012, Special Shareholders Meeting to approve an Advisory Agreement with Aberdeen Asset Management Asia Limited would be an exercise in futility, absent a liquidity event in Greater China Fund (GCH) shares.

On the same day, JF China Region Fund, Inc (JFC) re-announced a Merger Proposal to GCH. Two Days later, Bulldog Investors' filing group amended its own 13-D filing, making clear:

"The filing persons intend to do everything they can that is legal and ethical to permit them to sell their shares of GCH at or close to NAV …"

Suffice to say, GCH is a hot topic. While the 40% City of London ("COL") voting block in GCH is broadly perceived to be ethical and rational, there is great uncertainty how the GCH situation will resolve (ie: liquidation, open-ending, large scale tender, merger). COL appears to have preferences,

Last week, The Greater China Fund (GCH) announced its Board's approval of Aberdeen Asset Management Asia Limited as a new Investment Manager. The advisory agreement is subject to vote at a Special Shareholders Meeting on November 1, 2012. Approval in the absence of a large-scale liquidity event (announced or otherwise) would be shocking.

Yes, GCH is the Closed-End Fund whose prior Investment Management Agreement was terminated some four months ago by an absolute majority vote of shareholders. Its largest shareholder is City of London ("COL"), which in regards to GCH specifically has supported substantive recalibration of supply with demand to broadly benefit shareholder value in the face of an over-supply of China Region Funds. Ref: COL October 13, 2011 Filing 13-D, Exhibit A.

The conditional prospects for GCH's Advisory Agreement Vote require a look back at the root causes which necessitated a successful termination proposal's vote.

I will never categorically denounce Closed End Funds ("CEFs") as many do. However, I have more than once gotten an unsettled feeling while watching as Closed End Funds IPO above Net Asset Value, or later play further toward a perceived naivety among "mom and pop" investors.

Boards of Directors and CEFs' Advisors (to which board members are grateful for cushy roles) often have further interests which can conflict with shareholder value.

Observers might be surprised how vigorously CEFs' entrenched boards and the advisors paid to manage their fund take advantage of perceived naivety. Without getting into an overly egregious case, I will today highlight a recent example, Macquarie Global Infrastructure Total Return Fund (MGU).

MGU presents a worthwhile observations for CEFs boards and advisors. Management attempts to eschew any form of liquidity event even in the face of a proxy battle by paying proxy solicitors to escalate into hyperdrive without

Through September 14th, Liberty All-Star Growth Fund (ASG) shares appeared highly probable near term beneficiaries from forces of activism. Without any reason to perceive the manager as adding value historically (or in the future) it embodied a high conviction liquidity play thesis. The Board and manager, which had long forsaken shareholder value, needed votes from a very large shareholder block at Karpus Investment Management. All signs suggested that a large-scale tender offer or open-ending event was imminent, thus driving the NAV discount below 5%.

On September 15th, Karpus Investment Management disclosed a standstill agreement with the parties behind ASG (and USA). The standstill agreement (.pdf) arranges for Karpus’ private sale of nearly $11 million of ASG to DST systems (parent company of ASG and USA’s advisor: ALPS Advisors Inc.) at a favorable price.

The shares are being bought by DST systems, not by the fund company itself for the

A fool and his money are soon parted. In the investment industry, observation of advisors wasting client wealth occurs far too frequently. What is uncommon in the investment business is to watch advisors waste not only the investor's wealth, but the advisor's own ability to bill the fund company on assets under management ("AUM") - the advisor so culturally engrained with disservicing investors that they disservice themselves in the process.

SunAmerica's Closed-End Funds Focused Alpha Large-Cap (FGI) and Focused Alpha Growth (FGF) may provide the rare example.

In Closed-End Funds, once shares are issued in an IPO, the advisor has minimal financial interest to add value for the funds' shareholders. Shareholders cannot simply redeem their shares for Net Asset Value ("NAV"); in aggregate they are captive. If nobody wants to buy a certain closed-end fund at NAV, it will trade at a discount. The advisor collects fees from

Kayne Anderson MLP Investment (KYN) recently provided their 2010 3rd Quarter Report which in financial statements discloses $262,227, or more than 10% of its $ 2,493,902 Total Assets in “Deferred Tax Liability”.

It is my opinion that this data demonstrates the huge structural inefficiency for KYN along with its MLP-focused ETF, Mutual Fund, and Closed-End Fund peers. MLP focused funds (those whose portfolio constituents are more than 25% MLPs) are subject to C-Corporation tax treatment at the investment company level. In short, the “wrapper” applied to the MLP constituents can make a great Net Asset Value (“NAV”) sacrifice of the constituents’ market value performance even before expenses. Proportionally, the structural sacrifice appears to be about one-third of the underlying constituents’ performance, accounting for C-Corporation Tax Liability.

The specific “Deferred Tax Liability” data here is merely the symptom of the underlying structural inefficiency of using a single security for a

Tortoise Energy Infrastructure Corp (TYG) recently sent out their 2010 3rd Quarter Report. Shareholders who own TYG for exposure to the Master Limited Partnership (“MLP”) asset class may be well served to actually read it. A huge structural inefficiency for TYG along with its MLP-focused ETF, Mutual Fund, and Closed-End Fund peers is readily apparent:

At August 31, 2010, the balance sheet reflects a deferred tax liability of approximately $221 million or $8.20 per share.

$221,177,034 of the $1,307,718,802 in Total Assets was offset by net deferred tax liability due to the product’s single security wrapper for the diversified MLP exposure being taxable as a C-Corporation. Such data is merely the symptom of the underlying structural inefficiency of using a single security for a diversified set of underlying MLP holding constituents. The cost of the inefficiency, as reflected by NAV, grows as the underlying assets appreciate. Such is true

Tortoise Energy Capital Corp (TYY) recently sent out their 2010 3rd Quarter Report. Shareholders who own TYY for exposure to the Master Limited Partnership (“MLP”) asset class may be well served to actually read it. A huge structural inefficiency for TYY, along with its MLP-focused ETF, Mutual Fund, and Closed-End Fund peers is readily apparent:

At August 31, 2010, the balance sheet reflects a net deferred tax liability of approximately $83.7 million or $4.34 per share.

More than $83 million on $690,388,032 in Total Assets was offset by net deferred tax liability due to the product’s single security wrapper for the diversified MLP exposure being taxable as a C-Corporation. Such data is merely the symptom of the underlying structural inefficiency of using a single security for a diversified set of underlying MLP holding constituents. The cost of the inefficiency, as reflected by NAV, grows as the underlying assets appreciate.

The notion of “Asset Captivity” among closed-end funds doesn’t get much mainstream press. Instead, mainstream press focuses on a primary symptom: the illusion of a Black Friday sale on the New York Stock Exchange. A market price representing a discount to Net Asset Value (“NAV”) is only a relevant bargain if the discount is going to narrow at some point in time. Such occurs less often among funds whose governance choices could conceivable be interpreted as prioritizing Assets Under Management (“AUM”) or billable assets over shareholder value.

Neuberger Berman might be observed by some as being as least somewhat disinclined toward Asset Captivity. They have circumstantial tender offer programs for at least Neuberger Berman California Intermediate Municipal Fund Inc. (NBW), Neuberger Berman High Yield Strategies Fund Inc. (NHS), Neuberger Berman Intermediate Municipal Fund Inc. (NBH), Neuberger Berman New York Intermediate Municipal Fund Inc. (NBO) and Neuberger Berman Real Estate Securities

(Editorial note: This article has been edited with author consent upon the urging of Kayne Anderson. Nothing in the original article was untrue or misrepresented the opinion of the author. However, there was concern that the article could have better paid tribute to KMF’s intention to constrain the portfolio to 25% MLPs and qualify for Registered Investment Company tax treatment. Seeking Alpha and the author both intend to avoid the possibility of confusion to the lay-reader.)

On Tuesday evening November 23rd 2010, Kayne Anderson Midstream/Energy Fund (KMF) announced the pricing of its Initial Public Offering (“IPO”). Closed End Fund IPOs are always priced at a premium to their Net Asset Value (“NAV”) so regardless how good or bad the investment is for its new shareholders, such an announcement always marks a particular marketing feat.

Paragraph one of the press release highlights the size of the offering:

Kayne Anderson

The recent inquiry and writing from a Dow Jones reporter whom I respect has inspired me to share a more detailed perspective of the Korea Equity Fund (KEF). My original assessment of KEF, upon adding it to my account licensed to Covestor’s Well Intentioned Activism Profile Closed-End Funds model, was of course cognizant of perpetual headline risk. Headline risk is inseparable from any investment, especially those with direct exposure to Korea. Murray Coleman presented this observation exceptionally well in the context of regional economic expectations, which I will not repeat.

The actual realization of some headline risk in many ways presents a fresh “Wall of Worry” for all related assets. In this case, my preferred vehicle remains KEF. Is KEF my least risky holding? No, but I am interested to own, or with price sensitivity add to a KEF position at a discount greater than I can sell

On November 8, Seeking Alpha published what I believe to be a quite hazardous recommendation of Fiduciary/Claymore MLP Opportunity Fund (FMO) standing alongside what I previously believed, and continue to believe, is the singular, uniquely merited relative valuation reversion-to-the-mean Closed-End Fund trading candidate, Eaton Vance Risk Managed Diversified (ETJ). My assessment of ETJ's unique reversion-to-the-mean potential had been published as an Investment View on October 28.

For this and other reasons, qualitative assessments of apparent quantitative regression-to-the-mean Closed-End Fund candidates have certainly been on my mind of late. Today, I will highlight the reasons for which I believe FMO may be the most hazardous of all potential Closed-End Fund relative valuation regression-to-the-mean trading candidates. In short, I believe there are glaring weaknesses in the conclusions of "Joe Eqcome's" Nov. 8 article that recommends FMO.

Know Market Advantage and Disadvantage

Most of us don’t have a crystal ball and

On Friday, November 19th, 2010, the market price of Energy Income and Growth Fund (FEN) declined by 92 cents to $27, while the Net Asset Value (“NAV”) increased by 14 cents. A market premium narrowing from 8.01% to 3.89% in one day showcases the supply demand dynamics affecting Closed-End Funds. It is easy to appreciate why people are afraid of Closed-End Funds (“CEFs”).

Perhaps people should be afraid of them. CEFs require a tremendous attention to qualitative detail and average investors often mistake their surface level information value added insight.

The more important observations from Friday’s action in FEN was the catalyst for market move, and the hesitance which began being displayed among true expert CEF market participants for buying the dip. Between Thursday Night's News, and FEN's structural orientation, FEN appears a particularly troubling choice for accessing the MLP asset class. FEN now, or soon will emit attractive pheromones

Short-Selling generally comprises around 1% of my overall personal investing picture, and I frequently use Closed-End Funds among underfollowed securities for long positions. But, if or when I believe to anticipate that demand of a Closed-End Fund is likely to wane, I will open short positions based not on fanfare, but on objectivity.

Pimco Global Stocks Plus (PGP), which I am short in accounts licensed to Covestor’s Long/Short Opportunistic Model and Covestor’s Pure Short Opportunistic Model, is unusual among my favored short theses in that Fridays closing 57.65% market trading premium to its $14.05 Net Asset Value (“NAV”) may represent a particularly large supply/demand inefficiency. This is particularly surprising within a well known fund complex which has open-end mutual fund siblings like PIMCO StocksPLUS Total Return. Yes, PSOCX is available at NAV to those who want the mutual fund product without extraordinary fear of the valuation ramifications of

On November 9th, 2010 TS&W / Claymore Tax-Advantaged Balanced Fund (TYW) made a press release broadly observed to reflect directional uncertainty in light of the prospect for changes to the tax code. In reality, there is much more going on with this fund than broadly observed.

The Relevance of Tax Uncertainty is Broadly Shared

There is certainly broad relevance to investors of the possible expiration of, adjustment to, or limited extension of the Bush tax cuts, and more specifically, rates on qualified dividend income (“QDI”). I have even written about my Closed-End Fund thematic positioning for this potential catalyst. Although unheralded by the public still, it’s a big topic across all complexes. Among CEF families, Alpine’s high velocity Dividend Capture Funds (AOD, AGD) has a documented QDI goal. My acknowledgment of their simple disclosure is a relative compliment to governance of which I have been less than supportive

A risk-averse approach to wealth today demands greater acceptance of what are traditionally “risk assets”. A historically significant rally may be approaching as effective risk tolerance normalizes.

I rarely am compelled to contribute broad market observations to Seeking Alpha. Whether markets are broadly efficient or not, there is little scarcity of macro talent. Over time, I hope Mr. Market will primarily grade my talent (or lack thereof) for bottom up assessments of individual underfollowed securities. It is underfollowed securities that interest me most, because I think they foster the greatest inefficiencies and opportunities to seek alpha.

The last time I contributed a Macro Observation was a contrarian bottom call this July 6th when I felt the silly talk meter was reflecting too much pessimism. Whether Seeking Alpha’s editors had not recognized that my macro conviction was uncommon, or they had concern an author was writing without a known macro competency,