CEF Weekly Review: CLO CEFs' NAVs Take It On The Chin In March

Apr. 26, 2025 10:36 PM ET, , , , , , , , , , , 10 Comments
(5min)

Summary

  • We review the CEF market valuation and performance through the third week of April and highlight recent market action.
  • Nearly all CEF sectors finished in the green this week, though month-to-date performance remains underwater.
  • The median CEF sector discount has bounced off the trough, trading near the longer-term historical average, recovering close to half its April drawdown.
  • CLO CEFs reported March NAVs with an average drop of around 6%; April NAVs are expected to be 3-5% lower due to further credit spread widening.
  • We rotated our allocation from PDCC to ECC, seeing value in CCIF and EIC; market volatility has fueled significant alpha from relative value moves.
  • Looking for a helping hand in the market? Members of Systematic Income get exclusive ideas and guidance to navigate any climate. Learn More »
Financial market chart showing downward trends with red candlesticks and graphs on a dark background. Concept of stock market crisis. 3D Rendering

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Welcome to another installment of our CEF Market Weekly Review, where we discuss closed-end fund ("CEF") market activity from both the bottom-up – highlighting individual fund news and events – as well as the top-down – providing an overview of the broader market. We also try to provide some historical

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This article was written by

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ADS Analytics is a team of analysts with experience in research and trading departments at several industry-leading global investment banks. They focus on generating income ideas from a range of security types including: CEFs, ETFs and mutual funds, BDCs as well as individual preferred stocks and baby bonds.

ADS Analytics runs the investing group Systematic Income which features 3 different portfolios for a range of yield targets as well interactive tools for investors, daily updates and a vibrant community.

Analyst’s Disclosure:I/we have a beneficial long position in the shares of EIC, ECC, CCIF 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 (other than from Seeking Alpha). 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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