BRW: Provides Good Diversification For Your Portfolio

(14min)

Summary

  • Both BRW and SABA offer hedge fund-like strategies in a closed-end fund format, providing diversification and no performance fees.
  • BRW currently offers a higher distribution yield (13.01%) and trades at a 6.56% discount to NAV, while SABA yields 7.70% at an 8.69% discount.
  • Portfolio allocations have shifted, with both funds reducing SPAC exposure and holding large short positions in sovereign debt, emphasizing active management.
  • I rate both funds as strong HOLDS for diversification, preferring SABA when its discount is 2%+ above BRW, otherwise favoring BRW for its higher yield.
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Saba Capital Management is an investment advisory firm focused on various credit and equity relative value strategies. In many ways, it is like a publicly traded hedge fund housed in a closed-end fund structure. You do pay a fixed percentage investment

George is a contributor to the investing group Yield Hunting: Alternative Income Opportunities, a premium service dedicated to income investors who are searching for yield without the high risk of the equity market. The group manages four portfolios with a range of yield targets, a monthly newsletter, weekly commentary, rankings of CEFs based on yield, trade alerts, and access to chat for questions. Learn more.

This article was written by

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George Spritzer, CFA is a registered investment advisor who specializes in managing closed-end funds for individuals. George also shares his understanding of how to profit from investing with special situations as a catalyst.

George is a contributor to the investing group Yield Hunting: Alt Inc Opps, a premium service dedicated to income investors who are searching for yield without the high risk of the equity market. The group manages four portfolios with a range of yield targets, a monthly newsletter, weekly commentary, rankings of CEFs based on yield, trade alerts, and access to chat for questions. Learn more.

Analyst’s Disclosure:I/we have a beneficial long position in the shares of BRW,SABA 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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