CII - CII: Obtaining A High Yield At A Discount To NAV

2024-06-18 06:09:48 ET

Summary

• BlackRock Enhanced Capital and Income Fund prioritizes reliable income with consistent distributions and capital appreciation.
• CII uses an option writing strategy on holdings to generate income, reduce volatility, and maintain a diverse portfolio across sectors.
• CII offers a high dividend yield of 6.1%, with steady growth in dividends since 2016, making it a strong long-term income investment option.
• However, investors should not expect much upside price appreciation since the growth is capped by the option strategy implemented.
• CII's price currently trades at an attractive 7.4% discount to NAV, which may indicate an attractive entry opportunity.

Overview

BlackRock Enhanced Capital and Income Fund ( CII ) is a great option for investors that are looking to prioritize a reliable and consistent stream of income. CII operates as a closed end fund with the main objective of providing current income, followed by capital appreciation. The fund is managed by BlackRock and has a market cap of about $932M. The fund's inception dates back to 2004 and the performance since then has been pretty consistent, with most of the return profile coming from the distributions collected....

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