2024-06-04 13:13:15 ET
Summary
- DoubleLine Yield Opportunities Fund primarily invests in debt securities, which currently offer higher yields than common equities.
- The DLY fund has a distribution yield of 8.97%, which is probably attractive to income-focused investors, but lower than some peers.
- The fund's performance has been decent, but caution is advised as the share price may have gotten ahead of itself.
- The fund's management team appeared to have recognized the prevailing bond market trends YTD, but their rationale was wrong.
- The fund covered its distribution for the first half of the current fiscal year.
The DoubleLine Yield Opportunities Fund ( DLY ) is a closed-end fund aka CEF that income-focused investors can purchase as a method of achieving their goals. As is the case with most income-focused funds, the DoubleLine Yield Opportunities Fund invests primarily in debt securities. This is both a good thing and a bad thing. The good thing comes from the fact that fixed-income securities have significantly higher yields than common equities. We can see this by looking at the trailing twelve-month yields of a few fixed-income indices:
Index and ETF Tracking the Index | TTM Yield |
Bloomberg U.S. Aggregate Bond Index ( AGG ) | 3.40% |
Bloomberg High Yield Very Liquid Index ( JNK ) | 6.60% |
Vanguard World Bond Index ( BNDW ) | 4.05% |
J.P. Morgan EMBI Global Core Index ( EMB ) | 4.85% |
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For further details see:
DLY: Positioning Was Favorable For This Fund Year-To-Date