A handful of closed-end funds (CEFs) are boasting what are (at first) tantalizing dividend payouts. I’m talking 15%, 20% and even 40% annualized yields here.
Skeptical? You should be.
Today we’re going to delve into the two highest-paying funds in the CEF world and look at what’s driving their sky-high payouts. Each tells us a lot about what to avoid when buying CEFs for our portfolios.
High-Yield CEF #1: 22% Payout Masks a Dreadful Dividend History
The Cornerstone Strategic Value Fund (CLM) regularly yields more than 15%, even when average CEF yields are historically low. Now that all CEF yields are higher, due to an overall pullback in these funds’ market prices, CLM’s payout is a monster 22%.… Read more