doright

Why Closed-End Funds Don't Work for Most Investors

And more rot. Depending on the size of the management fee, you will be paying back some of that discount every year.
Also, some cef managers are motivated by their gain rather than total return for investors. They tend to trade at seemingly large discounts and those discounts are warranted.


On Jul 10 01:07 AM Elliott wrote:

> With all due respect I think you really missed the boat on this one.
> Just because T. Herzfeld uncovers complexity in CEFs that means that
> you make a sweeping generalization that CEFs are not appropriate
> for most investors?
>
> A Univ of Texas research paper concluded that "closed-end fund returns
> are both more predictable and more positively skewed than those of
> the returns from the corresponding net asset value." This makes sense
> to me. Which is better to buy: a basket of utility stocks or a CEF
> holding the same stocks but sells for 10 percent off? I'll take the
> CEF because the discount means less downside risk.