PFF - NPFD: Distribution Bump Amid Activist Pressure

2024-03-07 06:27:12 ET

Summary

• Nuveen Variable Rate Preferred & Income Fund has announced another sizeable distribution boost following a previous raise in December 2023.
• Saba Capital Management has initiated a position in NPFD and filed a preliminary proxy for the election of a new independent trustee.
• NPFD's discount has narrowed, but it is still at an attractive level to consider investing in the preferred fund with the potential catalyst of rate cuts for a brighter future.

Written by Nick Ackerman, co-produced by Stanford Chemist.

Nuveen Variable Rate Preferred & Income Fund ( NPFD ) announced a sizeable distribution boost with their February announcement. This raise itself was shortly after a raise in the distribution announced back in December 2023 as well. Shortly after the fund's inception, the Fed began hiking short-term interest rates aggressively. This caused many leveraged funds, including NPFD, to cut their distributions several times. With the Fed expected to lower rates in the next year or two, that should provide some relief in terms of borrowing costs for the fund....

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