CEF Weekly Review: Explaining Preferred CEFs Double-Digit Gains

2025-02-15 07:32:29 ET

Summary

• We review the CEF market valuation and performance through the first week of February and highlight recent market action.
• CEFs had a strong week, with most sectors in the green, driven by EM Equity and Muni sectors, and year-to-date gains in both NAVs and discounts.
• We take a look at why preferred CEFs have sharply outperformed their ETF counterparts last year.
• Eaton Vance and BlackRock made a number of distribution changes.
• We stick with a barbell approach, combining high-yield floating-rate funds like XFLT and SPMC with higher-quality fixed-rate assets like NMCO and PFO.

Welcome to another installment of our CEF Market Weekly Review, where we discuss closed-end fund ("CEF") market activity from both the bottom-up – highlighting individual fund news and events – as well as the top-down – providing an overview of the broader market. We also try to provide some historical context as well as the relevant themes that look to be driving markets or that investors ought to be mindful of....

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