Let me start the new year by laying out a proven investment fact:
If you want to find the coming year’s biggest losers, start by looking at the previous year’s biggest winners.
So let’s do that.
On the closed-end fund (CEF) side of things, last year’s top performer was a fund called ASA Gold & Precious Metals Limited (ASA), with a near-200% return.
ASA Romped in 2025
But don’t let that return, or the fund’s “cheap” 9.6% discount to net asset value (NAV)—more on that in a moment—pull you in. Because I see ASA flipping from 2025’s best CEF to 2026’s worst. And we do not want to be caught holding it as it does.
That’s because, in volatile markets like gold, fast growth like this often signals a peak, not the start of a longer climb.
Before we go further, I should point out that ASA yields almost nothing—just 0.1% as I write this. That makes the fund’s 2025 performance especially noteworthy, as investors typically buy CEFs for income: The average CEF yields 8.9% as I write this.
Still, profits are profits, and it follows that ASA’s strong 2025 should attract investors and help it rise in 2026, right?
Well, not so fast.
Since CEFs often trade at deep discounts when demand for them slips and at premiums when demand runs hot, we can get a good sense of the market’s view of ASA by looking at its discount or premium to NAV.
Investors Shrug Off ASA’s 2025 Run
The chart above tells us that ASA trades at a near-10% markdown. ASA has strayed above a 6% discount and below 12% at different times over the past year, but it’s mostly stayed between those two figures.
Which begs the question: Is the market wrong, and should ASA be priced higher? Or is the market trying to tell us something here?
To answer that, let’s take a glance at ASA’s top-10 holdings:
Source: ASA Gold and Precious Metals Limited (ASA) October 2025 fact sheet
Before I say more, let me point out that as of this writing, the fund hasn’t updated its fact sheet since October 2025, and it tends to update information more slowly than most CEFs. That’s already a red flag.
Second, we can see that this fund focuses on gold miners, as the name suggests, so it’s an option for your portfolio’s “precious metals” slot. It also holds 26% of its assets in exploration firms, not miners. That matters for the point we’re going to discuss next.
ASA Beat the ETF Competition in 2025—and That’s Another Warning Sign
Just to wheel back on the fund’s 2025 run for a moment, it’s critical to note that it also crushed both the largest gold ETF, SPDR Gold Shares (GLD), and the two largest gold-miner ETFs, the VanEck Gold Miners ETF (GDX) and the VanEck Junior Gold Miners ETF (GDXJ).
ASA Outruns the Competition
This by itself makes ASA look appealing: It invests in gold miners but beats the gold-miner ETFs. So why the big discount? Well, the market doesn’t believe the fund’s momentum will last, and there’s a good reason for that.
To understand this, let’s first point out that GDXJ, which as the name says focuses on smaller miners, outperformed GDX by a fair amount. In other words, smaller, newer gold firms did better than larger, more established ones in 2025.
That’s common in years when gold surges because higher gold prompts speculators to make bigger bets on gold that hasn’t come out of the ground yet. And GDXJ has much more exposure to these companies.
And our CEF, ASA, has even more exposure to them than GDXJ.
In other words, ASA’s focus on exploration firms put it in a better position to benefit from speculators’ bets on higher gold prices. GDX, for its part, has very little exposure to this higher-risk pocket of the mining world. So it’s no surprise that ASA would crush the competition in a year when speculation ruled the metal markets.
But the risks pile up as ASA’s market price rises. That’s because, every time in the last 50 years that gold has risen more than 30% in one year (as it did in 2025), it rises far less the following year. That puts ASA is in a weaker spot than most other gold funds.
This is the main reason why the smart money is likely to stay away from ASA. If gold doesn’t rise again in 2026—meaning even if it stays flat—ASA is set for losses.
If the yellow metal rises less than speculators expected, or if those exploration companies don’t strike gold, or, of course, if gold falls, then ASA could fall, as well. That leaves little margin for error.
Now, if we compare GLD and ASA directly and go as far back as we can on both, we see that GLD, with its focus on more-established miners, has returned more than twice as much as ASA.
GLD Takes Down ASA, Showing Size Matters in the Gold Space
The bottom line here is that if you want to hold precious metals in your portfolio, funds holding larger, more established miners are the way to go.
ASA? With all the risks facing the fund in 2026, it’s much more likely to go down than up. The discount? It’s deserved: The market has marked this fund down for a reason.
Forget ASA: These 4 Funds Are MADE for 2026 (With Reliable 9.2% Dividends)
The problem with funds like ASA isn’t just their volatility—it’s that they pay you nothing while you wait for their next run higher.
This is why dividend income is critical: When you’re collecting steady 8%+ dividends (common with CEFs), you can keep the bills paid in any market, without having to sell a single share in a pullback.
And, of course, we all know the next pullback is a question of when, not if.
With exactly that in mind, I’ve put together a portfolio of CEFs I’m urging all investors to buy now. They yield a rich 9.2% on average and come from across the economy, holding the best blue chips, REITs, corporate bonds and more.
Plus, these 4 funds are cheap now, which gives them an extra buffer when the inevitable next pullback arrives.
I urge you to pick them up now, before the crowd picks up on just how undervalued these 9% income plays are. Click here and I’ll walk you through each of them and give you a free report revealing their names, tickers and my complete research.
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