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This Closed-End Fund Looks Cheap And Boasts A 10% Yield: PCI
FYI: Analysts at Morgan Stanley Wealth Management gave the go-ahead to buy a Pimco bond closed-end fund that trades at steep discount and boasts a high yield.
5.8% is a "steep discount", when the 3-yr ave. discount has been 9.6%? 43% levered, total e.r. of 2+% Good yuck, investors; if a swan flies in, you're gonna need it.
No mention in the Barron's blog post of the fact that PCI is changing its name and investment mandate at the end of the month, which is probably an important point for anyone considering putting new $ into it.
I'll never understand these posts/articles about the attractiveness of ONE cef to the exclusion of all others. And, by the way, comparing one fund's p/d to a category average isn't all that meaningful for cef's; they're all over the place, depending a lot on the investment environment when they launched. As heezsafe wrote, it makes a lot more sense to look at the p/d trajectory of the fund itself, plus how the NAV's been doing and how well the earnings are covering the distribution.
Just one other point: I think most cef investors consider CEF Connect to be the go-to site (except for the fund provider's site, which for most fund companies is more likely to be up-to-date). The info on that CEFA site looks way too limited to base investment decisions on.
They are very late to the party. The PCI discount was over 15% in December, 2015. The more savvy CEF traders will be selling into their buy recommendation.
Comments
43% levered, total e.r. of 2+%
Good yuck, investors; if a swan flies in, you're gonna need it.
I'll never understand these posts/articles about the attractiveness of ONE cef to the exclusion of all others. And, by the way, comparing one fund's p/d to a category average isn't all that meaningful for cef's; they're all over the place, depending a lot on the investment environment when they launched. As heezsafe wrote, it makes a lot more sense to look at the p/d trajectory of the fund itself, plus how the NAV's been doing and how well the earnings are covering the distribution.
Just one other point: I think most cef investors consider CEF Connect to be the go-to site (except for the fund provider's site, which for most fund companies is more likely to be up-to-date). The info on that CEFA site looks way too limited to base investment decisions on.