FLC: A CEF That Actually Outperforms PFF Is Now Trading At A Discount

2025-03-28 11:45:45 ET

Summary

• FLC is a closed-end fund with a focus on preferred stocks and hybrid securities, primarily in the banking and insurance sectors, offering a 6.11% annualized distribution rate.
• FLC trades at an 8.75% discount to NAV and has outperformed PFF despite being a leveraged vehicle, exploiting its structural advantage.
• The fund's portfolio includes OTC preferred stocks, which offer better pricing opportunities compared to exchange-traded ones, enhancing its performance through its expertise.
• Despite higher management fees, FLC's solid track record and investment in quality instruments make it a superior choice over PFF for exposure to preferred stocks.

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I wish I were a Meme Coin expert, but my expertise is quite limited in the field, so I have to go with the Flaherty & Crumrine Total Return Fund ( FLC ) and compare it to the sector's benchmark: iShares Preferred and Income Securities ETF ( PFF )....

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