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PDI: The Big Premium, I'll Be Back, 10.1% Yield

Oct. 01, 2021 8:00 AM ETPIMCO Dynamic Income Fund (PDI)PDO, PTY68 Comments


  • PIMCO's 10.1% yield CEF, PDI, has watched its big premium (market price versus NAV) shrink as a large merger looms imminent.
  • With regards to the big premium, and as Arnold Schwarzenegger's Terminator character once said: I'll be back!
  • In addition to considering PDI, this article also shares views on other high-income PIMCO monthly pay CEFs, including PCI, PKO, PTY and PDO.
  • This idea was discussed in more depth with members of my private investing community, Big Dividends PLUS. Learn More »
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Often an income investor favorite, 2021 continues to be an interesting year for PIMCO’s lineup of big-distribution, monthly-pay, fixed-income closed-end funds (CEFs). For example, we’ve seen the launch of a new winner, a distribution cut from a perennial favorite, and now an imminent merger and sharply declining premiums

As mentioned, the 8 high-income CEFs we currently own are included within our 38-position Income Equity Portfolio (along with an attractive mix of additional high-income opportunities, including big-dividend REITs, BDCs, common equities and others). All the details are available to members of Big Dividends PLUS. And we are currently offering a rare 20% discount to all new subscribers.

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Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of PCI either through stock ownership, options, or other derivatives. 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.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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