CEF Weekly Review: The 13 closed end fund (CEF) types on average were down 3.5% for the week ending 10/30/09. On an aggregate, unweighted basis, the weekly average price change for 493 CEFs was down 3.1%.

The weighted 49 CEFs comprising the Claymore CEF Index registered an average decline of 5.6% for the week; First Trust CEF Composite Index was down 4.2%. The S&P 500, as measured by the SPDR S&P 500 ETF (SPY), registered a decline of 4.2%. Not a pretty picture.

Summary: There have been 17 stock market cycles (April ’42 first trough) and 12 US economic cycles (Oct ’45 first trough) since the early 1940s.

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CEF Weekly Review: The 13 closed end fund (CEF) types on average were up 0.6% for the week ending 10/23/09.

On an aggregate, unweighted basis, the weekly average price change for 514 CEFs was up 0.7%.

The 13 closed end fund (CEF) types on average were down 0.8% for the week ending 10/16/09. On an aggregate unweighted basis, the weekly average price change for 618 CEFs was down 1.6%.

The weighted 49 CEFs comprising the Claymore CEF Index registered an average advance of 1.0% for the week.

CEF Weekly Review: The 13 closed end fund (CEF) types on average were up 2.0% for the week ending 10/9/09. On an aggregate, unweighted basis, the weekly average price change for 523 CEFs was also up 2.0%. The weighted 49 CEFs comprising the Claymore CEF Index registered an average advance of 3.9% for the week. The S&P 500, as measured by the SPDR S&P 500 ETF (SPY), registered a surge of 4.7%.

(Click here for YTD CEF performance. The table is based on a 275 CEF sample size as all the data fields are not available for the CEF universe.)

Preface: Kudos to Nuveen and Morningstar for updating CEF stock pricing on Saturday for Friday’s close on CEFConnect.com.

CEF Weekly Review: The 13 closed end fund (CEF) types on average were down 0.3% for the week ending 10/2/09.

The average price change for the 13 CEF fund types for the 3^rd quarter ’09 was 15.5%. The unweighted average price change for the 617 CEFs was 16.5%. Both exceeded the S&P 500, as measured by the SPDRs’ ETF (SPY), of 14.8%.

LoanPartFnds and GenEqFnds were the percentage fund type leaders with approximately 21% price appreciation. USMrtgBndFnds was the laggards despite a respectable advance of 9.5%. GenEqFnds was pulled up by a small fund, Engex Inc. (EGX), which was the best performer for the 3Q, up 190.8%.

R.I.P.: Prior to the CEF Weekly Review, it is altogether fitting and proper for serious CEFs investors to take a moment to morn the untimely death (execution style) of a good friend: ETFconnect.com.

This unfortunate passing will create a hole in the knowledge base and likely result in the diminished interest in the CEF market segment.

Things must be tough at Nuveen.

It looks as though in an effort to cut costs they’ve replaced a superior ETFConnect.com with an inferior CEFConnect.com. It also appears that they replaced Lipper, which I believe was the previous data provider for ETFConnect.com, with Morningstar.

The 13 closed end fund (CEF) types on average were up 2.5% for the week ending 9/18/09. On an aggregate, unweighted basis, the weekly average price increase for 627 CEFs was up 2.3%. The weighted 49 CEFs as of 9/18/09 comprising the Claymore CEF Index registered an average increase of 3.1% for the week. The S&P 500, as measured by the SPDR S&P 500 ETF (SPY), registered an increase of 1.9%.

Preface: I believe I have clearly stated my case with supporting data for the overvaluation of PHK. Furthermore, I feel there is nothing I can add beyond what’s been written.

So, this will be the last comment I have on PHK until there is a major corporate event that proves me either right or wrong. As one commenter put it, it now sounds like I’m “ragging” on it. That was never my intent. I was seeking evidence to the contrary.

The 13 closed end fund (CEF) types on average were up 1.9% for the week ending 9/11/09. On an aggregate, unweighted basis, the weekly average price increase for 628 CEFs was also up 1.9%. The weighted 49 CEFs as of 9/11/09 comprising the Claymore CEF Index registered an average increase of 3.2% for the week. The S&P 500, as measured by the SPDR S&P 500 ETF (SPY), registered an increase of 2.7%.
The 628 CEFs’ aggregate, unweighted current distribution yield is 7.3% and is trading at a 4.4% discount (7.4% versus 4.5% the previous week, respectively). Year-to-date, CEFs on average have extended their price appreciation to 43.4%. (Click here for YTD CEF performance. The table is based on a 276 CEF sample size as all the data fields are not available for CEF universe.)

The Eqcome CEF Fear Index projected little fear on the part of CEF investors. The unweighted average price change was up 1.9% versus 0.2% for the related NAV. The CBOE Volatility Index (VIX), which typically moves inversely with the stock market, was down 4.4% as the S&P 500 (SPY) logged in an advance of 2.7%.

Recent investors in Pimco High Income Fund (PHK) may not be as dumb as I initially suspected. That honor may be duly shared by Pimco and Bill Gross who may have placed themselves in an untenable position.

Consider the following:

The 13 closed end fund (CEF) types on average were up 0.2% for the week ending 9/4/09. The S&P 500, as measured by the SPDR S&P 500 ETF (SPY), registered a decline of 1.3%. On an aggregate, unweighted basis, the weekly price increase for 630 CEFs was up 0.6%. The weighted 51 CEFs comprising the Claymore CEF Index registered an average decrease of 0.3% for the week.

The 13 closed end fund (CEF) types on average were up 0.6% for the week ending 8/28/09. The S&P 500, as measured by the SPDR S&P 500 ETF (SPY), registered a gain of 0.4%. On an aggregate, unweighted basis, the weekly price increase for 630 CEFs was up 0.7%.

The weighted 51 CEFs comprising the Claymore CEF Index registered an average increase of 0.6% for the week. The 630 CEFs’ aggregate, unweighted current distribution yield is 7.4% and is trading at a 4.6% discount (7.5% versus 4.2% the previous week, respectively). Year-to-date, CEFs on average have extended their price appreciation to 36.1%. (Click here for YTD CEF Performance)

Conclusion: While Credit Suisse Asset Management Income Fund (CIK) may, or may not, be in breach of Regulation FD (Fair Disclosure) in the manner it which it disseminated information regarding its most recent monthly distribution reduction, it is clearly in breach of its moral obligation to provide its own retail investors, on its own website, with the same disclosure timing it provided major data services.

Retail Investors’ Chopped Liver? While many of the data providers had already incorporated the news of a monthly dividend reduction from a monthly rate of $.03 per share to $.0265 into its database by Wednesday the 26th, it wasn’t until Friday the 28^th, that a press release appeared on its own website, dated August 21^st, disclosing the distribution reduction.

Conclusion: While “A foolish consistency is the hobgoblin of little minds…” it is an important consideration for investors seeking monthly distributions. Many investors look to closed-end funds (CEF) for attractive, secure monthly distributions. The most secure CEF distributions are those that are based on net investment income to common equity (NIICE).

In a review of CEFs that pay monthly distributions based on NIICE, the following CEFs deserve further consideration for possible additions to the equity-income portion of an investor’s portfolio: Trust/Aberdeen Global Opportunity Income (FAM), Alliance-Bernstein Global High Income Fund (AWF), Credit Suisse Asset Management Income (CIK) and Dreyfus High Yield Strategies Fund (DHF).

The 13 closed end fund (CEF) types on average were up 0.2% for the week ending 8/21/09. The S&P 500, as measured by the SPDR S&P 500 ETF (SPY), registered a strong gain of 2.2%. On an aggregate, unweighted basis, the weekly price increase for 630 CEFs was up 0.5%.

The weighted 51 CEFs comprising the Claymore CEF Index registered an average increase of 0.9% for the week. The 630 CEFs’ aggregate, unweighted current distribution yield is 7.5% and is trading at a 4.2% discount. Year-to-date, CEFs on average have extended their price appreciation to 35.1%. (Click Here for YTD CEF Performance.)

The 13 closed end fund (CEF) types on average were up 0.3% for the week ending 8/14/09. The S&P 500, as measured by the SPDR S&P 500 ETF (SPY), registered a decline of 0.4%. On an aggregate, unweighted basis, the weekly price increase for 634 CEFs was also up 0.3%.

The weighted 51 CEFs comprising the Claymore CEF Index registered an average declined 0.5% for the week. The 634 CEFs’ aggregate, unweighted current distribution yield is 7.5% and is trading at a 4.2% discount. Year-to-date, CEFs on average have extended their price appreciation to 34.5%%. (Click here for YTD CEF performance.)

According to Pimco High Income Fund’s (PHK) recent annual report, ninety-four percent (94%) of PHK’s portfolio, under FAS 157, is valued on a “mark-to-model” indirect pricing (“Level 2”) methodology. This means that PHK’s NAV is largely based on estimates generated by models developed by PHK’s advisor (PIMCO) and likely signed-off by PHK’s Valuation Committee.

As a result, PHK’s Valuation Committee materially determines its NAV based on PIMCO’s input. Ironically, investors are effectively betting against one of the best fixed income managers by bidding up the stock price 40% more than PIMCO’s current NAV estimates of $6.75 per share. Yet, on the other hand, investors will point to PIMCO’s skills as a reason for PHK’s higher stock price.