Introduction
Closed-end funds are similar to mutual funds. As one of investment funds, closed end funds have a diversified portfolio of stocks, bonds, or a mix of the two. They are managed by portfolio manager. It can be either passively or actively managed. It regularly distributes dividends and capital gains.One of the differences between mutual funds and closed-end funds (CEF’s) is closed end funds are traded like stocks on a stock exchange such as NYSE or NASDAQ. Mutual funds are also known as open-end funds.
Top Closed End Funds
These closed end funds are selected based on its performance and popularity among investors. It is also recognized by various financial website or magazine such as Morningstar, etc. You can find the fund review below as well.
The 5 Best Closed End Funds for 2013 are:
- DNP Select Income (DNP)
- PIMCO Global StocksPLUS & Income (PGP)
- Central GoldTrust (GTU)
- PIMCO Corporate & Income Opportunity (PTY)
- DWS Municipal Income Trust (KTF)
This DNP Select Income fund objective is to provide long term income and capital growth. It utilizes its assets to purchase equity and fixed income securities of the public utilities industry companies. The fund manager is Nathan Partain since 1998. The total net assets are $3.04 billion. Its yield is 7.01%. It is paid on monthly basis. It also has an expense ratio of 1.97% per year.
This domestic stock fund is ranked with 4 star and silver rating. The fund has returned 9.26% over the past 5 year, and 8.73% over the past decade. One of its best 1 year total returns is occurred in 2009 with 61.07%. The annual portfolio turnover rate is 13%.
As of April 2012, the top 5 holdings in this best CEF are Verizon Communications In, NextEra Energy Inc, Xcel Energy Inc, AT&T Inc, and Northeast Utilities. The top 4 sectors include general equity (73%), corporate debt (21%), preferred shares (4%), and net current assets (1.26%).
2. PIMCO Global StocksPLUS & Income (PGP)
This PIMCO Global StocksPLUS & Income fund invests its assets in stock index derivative instruments based on the S&P500 and MSCI EAFE Indices and through utilizing an options strategy. This equity fund is managed by Daniel J Ivascyn. It has 11.02% distribution yield. It has an effective leverage if 49.17%. This fund is trading 79% premium to its NAV (Net Asset Value).
This equity fund has an average 5 year return of 13.4%. Its average duration is 1.92 year and its average maturity of 6.18 years. The top 5 countries are USA (99.73%), UK (2.94%), Netherlands (1.07%), Luxembourg (1.03%), and Virgin Islands British (0.95%).
3. Central GoldTrust (Ticker: GTU)
The investment aim of Central GoldTrust fund is to seek to replicate the price of Gold Bullion performance. It has $1 billion of total net assets. The annual expense ratio is 0.40%. Morningstar has ranked this CEF with bronze rating.
In 2006, the fund has a 1 year total return of 35.43%. IT has returned 19.63% over the past 3 year, and 20.92% over the past 5 year.
4. PIMCO Corporate & Income Opportunity (PTY)
The PIMCO Corporate & Income Opportunity fund investment aim is to provide high income and capital appreciation. It invests most of assets in corporate debt obligation and other corporate income producing debts. Bill Gross is the fund manager. The fund sponsor is Allianz Global Investors Fund Management LLC. Its dividend yield is 8.63%. The fund has an expense ratio of 1.09%.
This taxable bond fund has a 5-year annualized return of 17.18%. The year to date return is 8.43%. It also has an average coupon of 8.16%. The average duration is 9.49 years. The top 5 countries are USA, UK, Brazil, Netherlands, and France.
5. DWS Municipal Income Trust (KTF)
The DWS Municipal Income Trust fund uses its assets to buy investment grade municipal securities. This tax free municipal bond fund is managed by Philip G Condon since 1999. It has a taxable equivalent yield of 9.38%. The dividend is distributed monthly. The total expense ratio is 1.23%.
This muni bond fund sponsor is Deutsche Investment Management Americas Inc. The top 5 municipal states are California, Texas, Florida, New York, and Georgia. It is ranked with 5 star rating by Morningstar.
Other Best Closed End Funds for 2013 are:
- John Hancock Premium Dividend (PDT)
- Putnam High Income Securities (PCF)
- Energy Income & Growth (FEN)
- Special Opportunities Fund (SPE)
- Cohen & Steers Total Return Realty (RFI)
- John Hancock Tax-Advantage Dividend Income (HTD)
- Templeton Emerging Markets (EMF)
- Global Income (GIFD)
- Templeton Emerging Markets Income (TEI)
- PIMCO High Income (PHK)
- Western Asset Managed Municipal (MMU)
- Nuveen California Select Quality Municipal (NVC)
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