5 Safe CEFs (with No Debt!) Paying Up to 9%

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Legendary investor and Berkshire Hathaway (BRK.B) CEO Warren Buffett recently gave us an insight into the type of dividend-paying fund he’d invest in if he could:

“Our aversion to leverage has dampened our returns over the years. But (partner Charlie Munger) and I sleep well. Both of us believe it is insane to risk what you have and need in order to obtain what you don’t need.”

“Leverage” stands out because it’s a common tool used among several high-yield classes, from mortgage real estate investment trusts (mREITs) to business development companies (BDCs). Even closed-end funds (CEFs) – which some investors turn to for relative safety versus individual stocks given CEFs’ diverse portfolios – can sport high leverage of between 30% and 60%.…
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There’s a storm brewing for closed-end funds, but it’ll be over by Christmas. And with a quick hand, you and I can profit from it.

More on that—and 5 CEFs that should be on your post-selloff buy list—in a moment.

First, I should tell you that the storm front I see coming stems from nothing more than the calendar on your wall (or more likely on your phone): the looming year-end, which often trips up CEFs (and other funds, as well as stocks). That’s because many investors sell at the end of the year to try to secure a lower tax burden when filing their taxes next year.…
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About Author

Brett

Hi, I’m Brett Owens – and I’m a financial junkie. My “problem” started incollege, when I got a little dose of the stock market – man, was I hooked…in no time, I was reading the Wall Street Journal religously.

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