Weekly CEF Roundup: May 18, 2018

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Includes: AEF, ASA, BHV, BST, CCA, CHN, CIF, CLM, CRF, CXH, DDF, DEX, DMO, DSE, DSU, EEA, EFF, EFL, EFR, EIA, EIM, EMI, ENX, EVG, EVM, EVN, EVV, EXD, FXBY, GDV, GER, GF, GIM, GLO, GLQ, GLV, GUT, ICB, KMM, MAB, MCR, MFD, MFV, MGF, MIN, MIW, MMT, MPV, MZF, NAV, NYH, PCQ, RCG, RCS, SMM, STK
by: Stanford Chemist
Summary

23 out of 31 sectors positive by price, and 25 sectors positive by NAV.

GUT rights expiring.

CLM and CRF file for rights offerings.

The Weekly CEF Roundup will be put out at the start of each week to summarize recent price movements in closed-end fund [CEF] sectors in the last week, as well as to highlight recently concluded or upcoming corporate actions on CEFs, such as tender offers. Most of the information has been sourced from CEFInsight or the Closed-End Fund Center. I will also link to some articles from Seeking Alpha that I have found for useful reading over the past week. The searchable tag for this feature is "cildoc". Data are taken from the close of Friday May 18, 2018.

Weekly performance roundup

CEFs struggled this week. 5 out of 31 sectors were positive on price (down from 23 last week) and the average price return was -0.68% (up from 0.82%). MLPs led with +2.47% return, followed by energy/resources at +0.63% and U.S. growth & income at +0.56%. Latin American equity lagged with -3.44% return, followed by U.S. real estate at -3.01% and emerging market equity at -1.54%.

(Source: Stanford Chemist, CEFConnect)

Similarly, 5 out of 31 sectors were positive on NAV (down from 25 last week), while the average NAV return was -0.65 (down from 0.85%). The NAV winners and losers were similar to the price winners and losers.

(Source: Stanford Chemist, CEFConnect)

The sector with the highest premium is multisector income (1.01%), while the sector with the highest discount is Latin American equities (-14.11%). The average sector discount is -6.62% (down from -6.59% last week).

(Source: Stanford Chemist, CEFConnect)

New Jersey munis showed the largest premium/discount increase (+0.55%), while U.S. general equity showed the largest premium/discount decline (-0.83%). The average change in premium/discount was -0.03% (same as -0.03% last week).

(Source: Stanford Chemist, CEFConnect)

The sector with the highest average 1-year z-score is MLPs (+0.58) while the sector with the lowest z-score is New York munis (-1.57). The average z-score is -0.47 (up from -0.50 last week).

(Source: Stanford Chemist, CEFConnect)

The sector with the highest yield is MLPs (9.64%), followed by global growth & income (9.48%), emerging market income (9.19%), global equity dividend (8.84%) and multisector income (8.80%). Discounts and z-scores for the sectors are included for comparison. The average sector yield is 6.80% (up from 6.76% last week).

(Source: Stanford Chemist, CEFConnect)

Individual CEFs that have undergone a significant decrease in premium/discount value over the past week, coupled optionally with an increasing NAV trend, a negative z-score, and/or are trading at a discount, are potential buy candidates.

Ticker

P/D decrease

Yield

P/D

z-score

Price change

NAV change

(CRF)

-9.21%

18.72%

16.05%

-0.2

-7.35%

0.00%

(CLM)

-8.64%

19.14%

13.47%

-0.3

-7.08%

0.00%

(BST)

-4.92%

4.86%

4.29%

1.7

-5.40%

-0.93%

(STK)

-4.11%

8.45%

1.91%

-1.2

-2.88%

1.03%

(DMO)

-3.39%

10.45%

13.53%

-1.0

-3.04%

-0.14%

(ASA)

-3.20%

0.38%

-16.12%

0.4

-2.89%

0.81%

(EXD)

-2.92%

12.00%

-8.25%

-0.4

-2.81%

0.29%

(MFV)

-2.77%

9.95%

1.77%

-1.2

-3.84%

-1.22%

(DSE)

-2.67%

10.19%

0.00%

-1.0

2.26%

4.99%

(PCQ)

-2.39%

5.83%

17.48%

0.0

-2.64%

-0.66%

(Source: Stanford Chemist, CEFConnect)

Conversely, individual CEFs that have undergone a significant increase in premium/discount value in the past week, coupled optionally with a decreasing NAV trend, a positive z-score, and/or are trading at a premium, are potential sell candidates.

Ticker

P/D increase

Yield

P/D

z-score

Price change

NAV change

(RCG)

8.06%

%

3.08%

1.5

12.52%

3.73%

(GER)

3.40%

9.17%

4.18%

2.6

7.88%

4.36%

(MZF)

3.21%

3.38%

-1.59%

3.3

2.38%

-0.96%

(OTCPK:FXBY)

3.10%

0.44%

-24.75%

2.4

4.65%

0.34%

(RCS)

2.58%

9.04%

31.50%

1.2

1.16%

-0.82%

(GLV)

2.54%

10.64%

-5.58%

1.0

1.58%

-1.16%

(MFD)

2.28%

9.90%

-0.25%

1.5

1.42%

-0.90%

(MFD)

2.28%

9.90%

-0.25%

1.5

1.42%

-0.90%

(MPV)

2.16%

7.11%

9.05%

2.0

2.01%

0.00%

(BHV)

2.12%

4.66%

8.13%

-0.7

1.19%

-0.79%

(Source: Stanford Chemist, CEFConnect)

Recent corporate actions

These are from the last month and are quoted from Closed-End Fund Center, Morningstar, or CEFInsight (email alerts); any new news in the past week has a bolded date:

May 16, 2018 | The Gabelli Utility Trust (NYSE:GUT) (the “Fund”) is pleased to announce the successful completion of its transferable rights offering (the “Offering” or “Offer”) in which the Fund will issue 8,831,210 common shares, totaling $48,571,655. The Offering was significantly over-subscribed, with $92 million received. Approximately 62% of the primary shares were subscribed for in the primary subscription, and the remaining shares were subscribed for pursuant to the over-subscription privilege. The over-subscription requests exceeded the over-subscription shares available. As a result, the available over-subscription shares will be allocated pro rata among those fully exercising record date shareholders who over-subscribed based on the number of rights originally issued to them by the Fund. The Fund will return to those investors that submitted over-subscription requests the full amount of their excess payments. All of the common shares subscribed for will be issued on or about May 21, 2018. Any new common shares issued as a result of the Offer will not be record date shares for the Fund’s monthly distribution to be paid on May 23, 2018 and will not be entitled to receive such distribution.

May 4, 2018 | MFS Investment Grade Municipal Trust (the "fund") (CXH) announced today that, in accordance with its tender offer for up to 7.5 percent of the fund's outstanding common shares (the “shares”), which expired at 5:00 P.M., Eastern Time, on May 2, 2018, the fund has accepted 738,668 shares, representing 7.5 percent of shares, for payment on or about May 7, 2018. A total of 3,253,218.909609 shares were properly tendered and not withdrawn by May 2, 2018, the final date for withdrawals. Therefore, on a pro-rated basis, approximately 22.70783 percent of the shares so tendered by each shareholder have been accepted for payment. The purchase price of properly tendered shares is 98 percent of the fund's net asset value (NYSE:NAV) per share calculated as of the close of regular trading on the New York Stock Exchange on May 2, 2018, which is equal to $10.084 per share.

April 18, 2018 | BlackRock Debt Strategies Fund, Inc. (the "Fund") (NYSE: DSU) announced today the final results of the Fund's tender offer (the "Tender Offer") for up to 10% of its outstanding shares of common stock (the "Shares"). The Tender Offer, which expired at 5:00 p.m. Eastern time on April 17, 2018, was oversubscribed. Therefore, in accordance with the terms and conditions of the Tender Offer, the Fund will purchase Shares from all tendering stockholders on a pro rata basis, after disregarding "odd lots" and fractions, based on the number of Shares properly tendered ("Pro-Ration Factor"). The final results of the Tender Offer are provided in the table below.

Number of Shares Tendered Number of Tendered Shares to be Purchased Pro-Ration Factor Purchase Price* Number of Outstanding Shares after Tender Offer
26,225,806 5,879,192 22.02% $12.41 52,912,736

* Equal to 98% of the Fund's net asset value per Share as of April 18, 2018 (the business day immediately following the expiration date of the Tender Offer).

Upcoming corporate actions

These are from the last month and are quoted from Closed-End Fund Center, Morningstar, or CEFInsight (email alerts); any new news in the past week has a bolded date:

May 11, 2018 | Aberdeen Emerging Markets Equity Income Fund, Inc. (the "Fund") (NYSE American: AEF) announced today that the Board of Directors of the Fund approved a tender offer by the Fund to acquire, in exchange for cash, up to 32% of the Fund's issued and outstanding shares at a price per share equal to 99% of the Fund's net asset value per share as determined by the Fund on the next business day following the expiration date of the tender offer (the "Tender Offer"). The Tender Offer will commence on or about May 22, 2018 and will expire at 11:59 p.m. New York City time on June 19, 2018, unless otherwise extended. The Tender Offer follows the consolidation of Aberdeen Emerging Markets Smaller Company Opportunities Fund, Inc. ("ABE"), Aberdeen Israel Fund, Inc. ("ISL"), Aberdeen Indonesia Fund, Inc. ("IF"), Aberdeen Latin America Equity Fund, Inc. ("LAQ"), Aberdeen Singapore Fund, Inc. ("SGF"), Aberdeen Greater China Fund, Inc. ("GCH") and The Asia Tigers Fund, Inc. ("GRR") into the Fund, which closed on April 27, 2018. As previously announced, the Fund also anticipates making a special distribution, comprised of net realized capital gains. The capital gain distribution is currently estimated to represent approximately 9% of the Fund's net assets which, in combination with the tender offer, will represent an aggregate distribution of approximately 41% of the consolidated Fund assets as of the reorganization closing date of April 27, 2018. It is anticipated that the exact final amount of the capital gains distribution will be formally declared on June 4, 2018 and will be paid on June 28, 2018 to shareholders of record on June 15, 2018, so that tendering shareholders who hold shares on the record date will be entitled to receive the distribution.

April 26, 2018 | The Boards of Trustees of the Funds listed below have approved proposals to merge the Funds as follows:

Acquired Fund (Trading Symbol) Acquiring Fund (Trading Symbol)
Eaton Vance California Municipal Bond Fund II (EIA) Eaton Vance California Municipal Bond Fund (EVM)
Eaton Vance Massachusetts Municipal Bond Fund (MAB) Eaton Vance Municipal Bond Fund (EIM)
Eaton Vance Michigan Municipal Bond Fund (MIW) Eaton Vance Municipal Bond Fund (EIM)
Eaton Vance New York Municipal Bond Fund II (NYH) Eaton Vance New York Municipal Bond Fund (ENX)
Eaton Vance Michigan Municipal Income Trust (EMI)

Eaton Vance Municipal Income Trust (EVN)

Each proposed merger is subject to approval by Acquired Fund shareholders at a Special Meeting of Shareholders scheduled for Friday, August 24, 2018. Proxy materials containing information about the meeting and the proposed merger will be mailed to each Acquired Fund's common shareholders of record as of June 15, 2018. Each Acquired Fund has substantially identical investment objectives and policies as the associated Acquiring Fund, except that Eaton Vance Massachusetts Municipal Bond Fund, Eaton Vance Michigan Municipal Bond Fund and Eaton Vance Michigan Municipal Income Trust invest primarily in municipal bonds the interest on which is generally exempt from both federal income tax and state income tax in the designated state, whereas the Acquiring Funds invest primarily in municipal bonds the interest on which is generally exempt from federal income tax.

April 20, 2018 | NexPoint Strategic Opportunities Fund (NYSE: NHF) (the "Fund"), formerly known as NexPoint Credit Strategies Fund, today announced the commencement of a non-transferable rights offering to purchase additional shares of common stock of the Fund (the "Offering"). The Fund is issuing non-transferable rights ("Rights") to its common shareholders of record as of May 9, 2018 (the "Record Date" and such shareholders, "Record Date Shareholders"). Record Date Shareholders will receive one Right for each common share held on the Record Date. The Rights will entitle the Record Date Shareholders to purchase one new share of common stock for every three Rights held (1 for 3). The Rights will be mailed to Record Date Shareholders approximately two business days after the Record Date. Record Date Shareholders who fully exercise their Rights will be entitled to subscribe for additional common shares of the Fund that remain unsubscribed as a result of any unexercised Rights by Record Date Shareholders. In addition, the Fund in its sole discretion may elect to issue additional common shares in an amount up to 25% of the common shares issued in the primary subscription.The subscription price per common share will be determined based upon a formula equal to the lesser of (1) 95% of the reported net asset value on May 29, 2018 (the "Expiration Date"), or (2) 95% of the average of the last reported sales price of the Fund's common shares on the New York Stock Exchange ("NYSE") on May 29, 2018 (the "Expiration Date") and on each of the four trading days preceding the Expiration Date.

April 20, 2018 | Morgan Stanley Income Securities Inc. (NYSE:ICB) (the “Fund”) is pleased to announce that its stockholders, at the Fund’s Special Meeting of Stockholders held on April 20, 2018, approved the reorganization (the “Reorganization”) of the Fund into the Corporate Bond Portfolio (“MSIFT Corporate Bond”). MSIFT Corporate Bond is a diversified series of Morgan Stanley Institutional Fund Trust, an open-end management investment company advised by the Fund’s investment adviser. In connection with the Reorganization, stockholders of the Fund will receive newly issued Class I shares of MSIFT Corporate Bond with a value equal to the aggregate net asset value of their common shares of the Fund on the valuation date, which is expected to be the close of business on or about June 1, 2018. The transaction is currently expected to close on or about June 4, 2018, subject to the satisfaction of certain conditions. Stockholders of the Fund will continue to be able to trade their common shares of the Fund on the New York Stock Exchange until the close of business on or about June 1, 2018. Subsequently, the Fund will cease trading on the New York Stock Exchange and will be dissolved.

Recent activist or other CEF news

These are from the last month and are quoted from Closed-End Fund Center, Morningstar, or CEFInsight (email alerts); any new news in the past week has a bolded date:

April 30, 2018 | Aberdeen Emerging Markets Equity Income Fund, Inc. (AEF)(the "Fund") announces today that it has successfully completed the reorganizations of Aberdeen Emerging Markets Smaller Company Opportunities Fund, Inc. ("ABE"), Aberdeen Israel Fund, Inc. ("ISL"), Aberdeen Indonesia Fund, Inc. ("IF"), Aberdeen Latin America Equity Fund, Inc. ("LAQ"), Aberdeen Singapore Fund, Inc. ("SGF"), Aberdeen Greater China Fund, Inc. ("GCH") and The Asia Tigers Fund, Inc. ("GRR") into the Aberdeen Chile Fund, Inc. ("CH") after close of regular business on April 27, 2018. Effective today, the consolidated fund has been renamed and will trade on the NYSE American Exchange under the ticker symbol "AEF." In the reorganizations, common shareholders of ABE, ISL, IF, LAQ, SGF, GCH and GRR, respectively, received an amount of CH common shares with a net asset value equal to the aggregate net asset value of their holdings of ABE, ISL, IF, LAQ, SGF, GCH and/or GRR common shares, as applicable, as determined at the close of business on April 27, 2018.

April 27, 2018 | City of London Investment Management Company Limited, which represents clients who are the beneficial owners of approximately 27.6% of the outstanding shares of common stock of The China Fund, Inc. (NYSE: CHN), today commented on China Fund Board's continued waste of stockholder assets and actions to prevent stockholders from exercising their fundamental right to vote (press release).

April 26, 2018 | The Gabelli Dividend & Income Trust (NYSE:GDV) (the “Fund”) announced today that it will redeem one half (1,271,148 shares) of its outstanding 6.00% Series D Cumulative Preferred Shares (the “Series D Preferred Shares”). The shares will be redeemed at $25.30 per Series D Preferred Share (the “Redemption Price”), which consists of $25.00 per Series D Preferred Share (the liquidation preference) plus accumulated and unpaid dividends and distributions through the redemption date of June 8, 2018. From and after the redemption date, the Series D Preferred Shares being redeemed will no longer be deemed outstanding, dividends will cease to accumulate and all the rights of the Series D Preferred shareholders with respect to the redeemed Series D Preferred Shares will cease, except the right to receive the Redemption Price, without interest.

Distribution changes announced this month

These are sorted in ascending order of distribution change percentage. Funds with distribution changes announced this month are included. Any distribution declarations made this week are in bold. I've also added monthly/quarterly information as well as yield, coverage (after the boost/cut), discount and 1-year z-score information. I've separated the funds into two sub-categories, cutters and boosters.

Cutters

Name Ticker Change Previous Current Yield Discount z-score Coverage Announced Ex date
MS Income Securities (ICB) -59.8% 0.10583 0.0425 2.78% -0.54% 1.7 116% 5/8/2018 5/17/2018
New Germany Fund (GF) -57.9% 0.7433 0.3129 5.34% -10.98% 0.7 17% 5/9/2018 5/18/2018
Duff & Phelps Select Energy ML (DSE) -31.8% 0.22 0.15 10.19% 0.00% -1 0% 5/1/2018 5/10/2018
Salient Midstream & MLP Fund (SMM) -29.9% 0.244 0.171 6.69% -8.67% -0.4 0% 5/7/2018 5/16/2018
EV Limited Duration Income (EVV) -16.9% 0.0806 0.067 6.32% -12.81% -2 98% 5/1/2018 5/10/2018
EV Short Duration Diversified (EVG) -15.0% 0.0765 0.065 5.88% -11.66% -2 86% 5/1/2018 5/23/2018
European Equity Fund (EEA) -14.0% 0.0351 0.0302 0.66% -11.13% -1 -16% 5/9/2018 5/18/2018
Deutsche Multi-Market Income (KMM) -7.1% 0.035 0.0325 4.42% -2.65% 2.2 116% 5/9/2018 5/18/2018
Clough Global Opportunities (GLO) -3.2% 0.1031 0.0998 10.89% -9.02% -0.3 -4% 5/11/2018 5/18/2018
Templeton Global Income (GIM) -3.0% 0.0336 0.0326 4.75% -12.08% -0.8 93% 5/1/2018 5/14/2018
Clough Global Equity (GLQ) -2.9% 0.1257 0.122 10.48% -6.49% 1.1 -4% 5/11/2018 5/18/2018
Delaware Enhanced Gbl Div&Inc (DEX) -2.6% 0.1086 0.1058 10.82% -5.40% 1.8 25% 5/1/2018 5/10/2018
MFS California Municipal Fund (CCA) -2.5% 0.04 0.039 4.57% -15.44% -1.9 -121% 5/1/2018 5/15/2018
EV Float-Rate 2022 Target Term (EFL) -2.4% 0.042 0.041 5.18% -2.46% 0 79% 5/1/2018 5/10/2018
Delaware Inv Div & Inc (DDF) -2.2% 0.0986 0.0964 10.48% -4.17% 3.2 27% 5/1/2018 5/10/2018
Clough Global Div and Inc Fund (GLV) -2.1% 0.1166 0.1141 10.64% -5.58% 1 1% 5/11/2018 5/18/2018
EV Senior Floating Rate (EFR) -1.4% 0.073 0.072 5.83% -4.30% -0.2 105% 5/1/2018 5/23/2018
MFS Special Value Trust (MFV) -1.4% 0.04842 0.04776 9.95% 1.77% -1.2 29% 5/1/2018 5/15/2018
MFS Intermediate Income (MIN) -0.6% 0.03008 0.02991 9.40% -7.95% -1.7 26% 5/1/2018 5/15/2018
MFS Government Markets Income (MGF) -0.4% 0.02956 0.02943 7.87% -6.07% -1.1 38% 5/1/2018 5/15/2018
MFS Multi-Market Income (MMT) -0.3% 0.04249 0.04236 9.04% -9.94% -1.5 54% 5/1/2018 5/15/2018
MFS Charter Income (MCR) -0.3% 0.05965 0.0595 9.03% -9.70% -1.8 51% 5/1/2018 5/15/2018
MFS Intermediate High Income (CIF) -0.2% 0.02103 0.02098 9.54% 1.54% -0.2 61% 5/1/2018

5/15/2018

Boosters

Name Ticker Change Previous Current Yield Discount z-score Coverage Announced Ex date
EV Floating-Rate Inc Plus Fund (EFF) 1.4% 0.074 0.075 5.54% -8.31% -0.4 99% 5/1/2018

5/23/2018

CEF analysis from around Seeking Alpha...

Recommended reads are in bold.

Alpha Gen Capital presents A Quick Rundown Of Our 3 Portfolios (Buckets) (May 22)

Arbitrage Trader presents Weekly Review: High-Yield CEFs (May 16), Weekly Review: Municipal Bond CEFs (May 16), Weekly Municipal Bond CEF Trades (May 16), and Weekly Review: Master Limited Partnership CEFs (May 16)

Left Banker presents NHF Rights Offering: What Should We Expect? (May 13), Cornerstone Back At The Trough: CLM And CRF Rights Offerings For 2018 (May 16), NHF's Rights Offering: Should You Subscribe? (May 19) and Today's History Lesson: Cornerstone Closed-End Funds (May 21)

Nick Ackerman presents CEF RQI: Time To Get In (May 15), CEF AWF: High Yield Undervalued (May 16), CEF BGH: High Yield Short Duration (May 18) and Closed-End Funds: Oil, Oil, Oil! (May 19)

Stanford Chemist presents: Thoughts On GUT's Rights Offering (May 14), The Chemist's Quality CEF Report - April 2018 (May 17) and Weekly CEF Roundup: DSE Cuts Distribution By -31% (May 21)

Steven Bavaria presents Dividend Cuts - Managing Their Impact On Our 'Income Factory' (May 21)

*To subscribers: these link to the public version of the article, which you will already have seen in the members section.

Macro/market section

Fear & Greed Trader presents S&P 500 Weekly Update: Keep It Simple, Listen To The Stock Market (May 20)

Jeff Miller presents Weighing The Week Ahead: Will Higher Interest Rates Lead To Lower Stock Prices? (May 20)

Lane Roberts presents Consolidating The Breakout (May 20) and Technically Speaking: Riding The Bull (May 21)

Cambridge Income Laboratory members only

Here, we provide exclusive commentary and actionable takeaways on specific funds. In this issue, we discussed the rights offering of the Cornerstone funds (CLM and CRF), suggested a preliminary action plan for NHF's rights offering, and presented 3 more overvalued funds to consider selling or replacing.

Disclosure: I am/we are long the portfolio securities.. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.