VPV - Why Fundamentals Combined With Anomalous Discounts Create Winners
One of the biggest draws to closed-end funds (CEFs) is the fact that investors can get $1.00 worth of assets for 90 cents. In addition, the leverage within the funds helps to create high-single digit, and in some cases, low-double digit yields. The combination of buying assets "on sale" and the juicy yields can be a siren song for many mom-and-pop investors.
But the lower liquidity of closed-end funds and the lack of institutional ownership in the space can exacerbate moves higher and lower. We see countless times investors running for the exit all at