For the month, 92% of all closed-end funds (CEFs) posted net asset value (NAV)-based returns in the black, with 86% of equity CEFs and 97% of fixed income CEFs chalking up returns in the plus column. For the fifth consecutive month, Lipper’s domestic equity CEFs macro-group (+2.19%) outpaced its two equity-based brethren: world equity CEFs (+2.13%) and mixed-assets CEFs (+0.66%). The Energy MLP CEFs classification (+6.74%) for the second month in a row outperformed all other equity classifications, followed by Natural Resources CEFs (+4.34%) and Developed Markets CEFs (+3.29%).
For the second consecutive month, the world income CEFs macro group posted the strongest returns in the fixed income universe, posting a 1.36% return on average, followed by municipal bond CEFs (+0.91%) and domestic taxable fixed income CEFs (+0.76%). Fixed-income investors continued their search for yield. They pushed Corporate Debt BBB-Rated CEFs (Leveraged) (+0.96%) to the top of the domestic taxable fixed income leaderboard for the second month in a row, followed by Loan Participation CEFs (+0.85%) and High Yield CEFs (+0.79%).
For May, the median discount of all CEFs narrowed 121 bps to 2.80% - narrower than the 12-month moving average median discount (7.06%). In this report, we highlight May 2021 CEF performance trends, premiums and discounts, and corporate actions and events.
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