- Closed-end funds can offer ways to invest in a diversified portfolio of energy stocks and secure a higher yield than could be obtained otherwise.
- FEN invests mostly in midstream names but there also are some electric utilities in the portfolio.
- The long-term fundamentals for midstream are strong as the global demand for fossil fuels is likely to grow over the next two decades.
- The fund may be over distributing, which is not sustainable over any kind of extended period due to the NAV destruction.
- The fund is trading at a huge discount, which may be due to the history of value destruction.
For further details see:
FEN: A Promising Energy Income CEF If The Distribution Is Sustainable