Virtus Global Multi-Sector Income Fund Results Justify Skipping This CEF

Summary

  • Virtus Global Multi-Sector Income Fund invests, as the name implies, in fourteen sectors of the Global Fixed Income market.
  • VGI's strategy of trying to be in multiple sectors has the fund underperforming single-focused funds and many of its multi-sector competitors. Even income-seekers might have better choices.
  • After comparing VGI to other fund choices in the High-Yield space, I give this CEF a Bearish rating at best. Recent history shows 50% of the payout is from Return-of-Capital.

Fixed Income

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Introduction

10 year treasury rate and US high yield B effective yield

With rates on government debt and non-investment-corporate debt at record lows, funds that can go anywhere to enhance the yield they provide investors are gaining interest (pun intended). With Closed-End Funds ability to use leverage, it gives them

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Retired Investor has been investing since the 1980s and has a background in data analysis and pension fund management. He writes articles to help others prepare for retirement by investing in CEFs, ETFs, BDCs, and REITs. He is a long only investor and shares strategies for trading options with a focus on cash-secured-puts.

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Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. 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.

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