The Month In Closed-End Funds: May 2021

Jun. 05, 2021 12:08 AM ETASA, CTR, CEM, EMO, KYN, NXDT, HFRO, WIW, WIA, NMCO2 Comments6 Likes
Tom Roseen profile picture
Tom Roseen


  • For the seventh month in a row, equity closed-end funds (CEFs) on average posted positive returns, rising 1.90% on a NAV basis for May.
  • While for the third month running fixed income CEFs posted plus-side returns (+0.86%).
  • Thirty percent of all CEFs traded at a premium to their NAV, with 30% of equity CEFs and 31% of fixed income CEFs trading in premium territory.
  • Energy MLP CEFs (+6.74%) for the second month in a row posted the strongest one-month returns of the equity classifications in the CEF universe for May.
  • For the second consecutive month, the Emerging Markets Hard Currency Debt CEFs (+1.89%) classification posted the strongest plus-side returns in the taxable fixed income CEF universe for May.

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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.


This article was written by

Tom Roseen profile picture
Tom Roseen is the Head of Research Services, joining from Janus in 1996. He is the editor and an author of Lipper's U.S. Research Studies, FundFlows Insight Reports and FundIndustry Insight Reports. He is involved in fund analysis and research, and contributes to the monthly and quarterly equity and fixed income FundMarket Insight reports, webcasts and podcasts, where he focuses on domestic and world fund performance and attribution. His areas of expertise include closed-end fund analysis, portfolio evaluation, equity and fixed income fund research, fund flows analysis, after-tax performance and Lipper Leaders. Tom has a BS in finance from Metropolitan State College of Denver and a Master's in International Management from the University of Denver.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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