This post was just published on ZYX Global Multi Asset Allocation Alert.
Closed end funds trade on exchanges just like ETFs. The difference is that unlike ETFs, closed end funds have a fixed number of shares. Therefore they either trade at a premium or a discount to net asset value.
The objective is to earn about 20% return in three to four months. Last year’s list returned 51% capital gains plus 12% yield.
It is common at the year-end for discounts on funds in unfavorable sectors to widen considerably. These discounts narrow again in February- March period. The plan is to buy funds if their discounts widen enough before the year-end to put them in the buy zones.
