PDI - PDI: 14% Yield But Risks Are Rising (Rating Downgrade)
2024-01-24 00:55:24 ET
Summary
- PIMCO Dynamic Income Fund offers a 14.2% dividend yield but is now selling at a 10% premium to net asset value.
- The fund may not see as fast a decline in short-term interest rates as expected, delaying a broader re-rating.
- Recent inflation data raises concerns about the fund's ability to benefit from lower interest rates, leading to a downgrade to a Hold rating.
Closed-end funds can play a very important role in asset allocation, income generation and diversification. One closed-end fund that I valued highly was the PIMCO Dynamic Income Fund ( PDI ) which presently provides passive income investors with a 14.2% dividend yield....
PDI: 14% Yield, But Risks Are Rising (Rating Downgrade)