EVG - BLW: A Reasonable Choice For Today's Bond Market But Watch Its NAV
2024-04-25 04:15:47 ET
Summary
- The BlackRock Limited Duration Income has a reasonable 9.53% yield, but it is lower compared to other funds investing in similar assets.
- The fund's performance has been mixed, underperforming the Bloomberg U.S. Aggregate Bond Index in 2022 but outperforming it year-to-date.
- The fund employs leverage to boost its effective yield, but its leverage level is higher than some peers and its expenses are relatively high.
- The fund has significantly outperformed its peers over the past five years, so its expenses appear to be justified.
- The bond market might still be overpriced given the declining likelihood of significant rate cuts and the fund has failed to cover its distribution year-to-date.
The BlackRock Limited Duration Income ( BLW ) is a closed-end fund that income-focused investors can employ as a method of achieving their goals. As is the case with most fixed-income funds, this one has a reasonable 9.53% yield at the current price. This yield is reasonable, but unfortunately, it does not compare very well with other funds that invest in similar assets. We can see that here:
| Fund Name |
| Morningstar Classification |
| Current Yield |
| BlackRock Limited Duration Income Trust |
| Fixed Income-Taxable-Limited Duration |
| 9.53% |
| Allspring Multi-Sector Income Fund ( ERC ) |
| Fixed Income-Taxable-Limited Duration |
| 8.78% |
| Eaton Vance Limited Duration Income Fund ( EVV ) |
| Fixed Income-Taxable-Limited Duration |
| 10.07% |
| Eaton Vance Short Duration Diversified Income Fund ( EVG ) |
| Fixed Income-Taxable-Limited Duration |
| 9.04% |
| Franklin Limited Duration Income Trust ( FTF ) |
| Fixed Income-Taxable-Limited Duration |
| 11.90% |
| PCM Fund ( PCM ) |
| Fixed Income-Taxable-Limited Duration |
| 11.35% |