Market Volatility? Let Us Help You Navigate

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• (1) Identify the most profitable CEF and ETF opportunities.
• (2) Earn a ~8% dividend yield together with capital appreciation.
• (3) Avoid the overpriced funds that can sink your portfolio.

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September has been following its historical pattern of being a rather poor month for the market. The S&P 500 in the month of September has declined an average of 1%. This could be exaggerated as the broader index hasn't experienced a market pullback or correction since last year. That could mean we are primed for downside pressures as investors are looking for a reason to sell.

A market pullback is typically considered when the averages decline 5 to 10%. A correction would be classified as a 10 to 20% decline from highs. Declines of greater than 20% would put us in a technical bear market.

Pullbacks happen fairly frequently. Going back to 1945 there have been 84 pullbacks in the 5 to 10% range. 29 declines in the 10 to 20% range and bear markets are fewer occurring 9 times since 1945. 40% declines or more, while not having a technical name applied to it (maybe we can call it a double bear market,) have happened 3 times since that same year.

(Source - Guggenheim)

As we can see above, the time to recover is quite swift for these smaller pullbacks. Then the time for recovery increases further the deeper the declines. Another important consideration is that it takes less time for the declines to happen relative to the time it takes to recover.

The S&P 500 is down nearly 4% already this month now. This is measured by the S&P 500 SPDR ETF (SPY) in the chart below.

Data by YCharts

We've certainly seen a volatile tick-up as the VIX is heading higher. Market moves on September 20th really ramped this up. VIX is the measurement for CBOE Volatility Index. It measures stock market's expectation for volatility based on the S&P 500 options. The higher that goes, the more investors will expect volatility. The chart below goes back 3 years to show last year's significant increase as March 2020 took over the market. We are still down considerably from that level but we have moved sharply higher this month now.

Data by YCharts

For closed-end funds, all of this can add up to even more significant volatility. This is due to the price not being tied to the actual underlying net asset value. That is what opens CEFs up to discounts and premiums. In market sell-offs, we typically see discounts widen out significantly.

As we've been in recovery mode, we've seen the opposite. Discounts have become very narrow. In fact, discounts have only been more narrow 10% of the time going back to 1996, according to RiverNorth.

(Source - RiverNorth)

This wasn't equal across asset classes though. Fixed-income CEFs in both the taxable and muni space have now approached an average premium across the board.

(Source - RiverNorth)

While at the same time, equity funds remain stuck in discount mode. Though the discounts have tightened considerably from what they were average at the end of 2020. That is for both equities and fixed-income CEFs.

(Source - RiverNorth)

In this time of volatility, you can let the CEF/ETF Income Laboratory help you navigate through the volatility. In fact, our double-compounding strategy can generally work even better during tumultuous times as discounts tend to diverge more frequently.

The "compounding income on steroids" methodology enables one to grow their share count without DRIPing. So in effect, you can potentially get a double compounding from CEF rotation plus dividend reinvestment. For investors who need to withdraw their dividends for living expenses, this method can also allow you to grow the income stream to keep up with inflation, even without having to reinvest all of the distributions.

The nice thing about this strategy is that it can be easily fine-tuned to fit the style of both active and passive investors. Even so, many conservative investors still balk at the first mention of "trading" or "arbitrage" or "rotation". They may ask,

"Why sell a fund that has been paying me a steady dividend for X years? Whether the fund is overvalued or undervalued does not affect the stability of the income stream."

My response is: yes, that's right. But we can do better than that!

Our method is simply a strategy that is OVERLAID on top of an existing income strategy and DOES NOT replace it. Even a few trades a year can make a huge difference to the bottom line of a conservative income portfolio!

Just ask yourself this question: if I came up to you and offered you a FREE increase of 5% of your existing shares of a particular CEF, would you say yes or no? If your answer is yes, take the dive today and let us help you!

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We'd love for you to become a member today, joining over 1000 other serious CEF and ETF investing members. That's why we are offering a discount of 20% off the first year of membership for more serious, like-minded investors only!

Here is a little bit about what we offer;

• 4 experts for the price of 1
• 4 model portfolios that investors can easily follow along with
• 24/7 chat board for asking questions and discussing investment opportunities
• immediate access to all of our articles - no delay and this also includes exclusive articles that never get republished

Feature	Free	Premium
Chat board	No access to chat board.	24-hour access to chat board with Stanford Chemist, Nick Ackerman, Juan de la Hoz and Dividend Seeker, as well as over 1000 other serious like-minded CEF/ETF income investors, some with decades of trading or professional experience.
Timing of articles	Certain articles generally released after 2 to 4 weeks of delay.	Immediate access to all articles. This can be significant for short/medium-term trading ideas (e.g. CEF arbitrage), corporate actions (such as rights offers or tender offers) where immediate action is required, or for acting on timely buy and sell alerts for undervalued or overvalued funds.
Portfolios and trade alerts	None.	A Tactical Income Portfolio to exploit mean reversion, special situations and deep value opportunities, an Income Generator Portfolio for steady income, and a Taxable Income Portfolio for maximizing after-tax returns. Also, a newly-launched ETF Income Portfolio.
Commentary and analysis	A "just the numbers" presentation on the quantitative aspects of the fund or market, no specific recommendations.	Additional actionable insight and commentary is provided. For example, in the CEF Weekly Roundup we provide actionable recommendations on relevant fund news and events. In the monthly CEF reports, we may make a recommendation as to whether a certain top-ranked fund may belong in your portfolio or not.

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CEF/ETF Income Laboratory: Profitable CEF and ETF Income and Arbitrage Ideas

Whether you're a novice or experienced closed-end fund ("CEF") and exchange-traded fund ("ETF") investor, the "Income Lab" is the right place for you. Our goal is to help you benefit from income and arbitrage strategies in CEFs and ETFs, all without having to be an expert, because we do the heavy lifting for you. If that sounds like something you'd be interested in, we hope you'll consider joining us here at CEF/ETF Income Laboratory.

We would love for you to join us. We are sure that you will enjoy our service and benefit from what we have to offer!

Sincerely,

Stanford Chemist, Nick Ackerman, Juan de la Hoz and Dividend Seeker