CLM: It's Not A 'Buy And Forget' High-Income Fund

Summary

• Cornerstone Strategic Value Fund has a high dividend yield of over 17% but has seen a significant decline in price over the last decade.
• The fund's distribution history is inconsistent, but it may still be appealing when paired with other high-yielding assets. In addition, the accumulation of shares at NAV offsets this.
• Despite the poor NAV growth, the total return performance has been high because of the distribution.
• CLM is best utilized when the investor is aware of Rights Offerings and takes advantage of the dividend reinvestment NAV discount benefit.

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Overview

Taking a look at the price chart of Cornerstone Strategic Value Fund (NYSE:CLM) is sure to scare away some first-time viewers. The price has fallen by over -70% in the last decade alone. However, this Closed-End

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in CLM over 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.