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Discounts On Muni CEFs

Discounts on muni CEFs have hit 52-week low again for the second time this year. NAV have been flat while these funds have been selling off. Looks like discounts are here to stay for awhile as these funds are now out of favor with folks anticipating rising rates. Looks like money fleeing muni CEFs have found new home in floating rate CEFs as they are trading mostly at premium to NAV.

I don't think rates are headed up any time soon as we are in a period of disinflation. Muni CEFs have become compelling as their discounts to NAV are near or greater than the 52-week lows.

Disclosure: I am long NZF.

Stocks: NZF, NVG, NZF