For the month, only 36% of all closed-end funds (CEFs) posted net-asset-value (NAV)-based returns in the black, with just 14% of equity CEFs and 53% of fixed income CEFs chalking up returns in the plus column. For the second month in three, Lipper’s mixed-assets CEFs (-2.08%) macro-group mitigated losses better than or outpaced its two equity-based brethren: domestic equity CEFs (-2.26%) and world equity CEFs (-4.20%). The Real Estate CEFs classification (+0.38%) for the first month in four outperformed all other equity classifications, followed by Options Arbitrage/Options Strategies CEFs (-1.28%) and Income & Preferred Stock CEFs (-1.64%).
For the first month in four, the municipal bond CEFs macro-group chalked up the strongest returns in the fixed income universe, posting a 1.46% return on average, followed by domestic taxable fixed income CEFs (-0.50%) and world income CEFs (-2.02%). Fixed income investors became more risk averse during the month. They pushed U.S. Mortgage CEFs (+0.02%) to the top of the domestic taxable fixed income leaderboard for the first month since September 2020, followed by Corporate Debt BBB-Rated CEFs (Leveraged) (-0.07%) and Corporate Debt BBB-Rated CEFs (-0.23%).
For November, the median discount of all CEFs widened nine basis points (bps) to 2.40%—still narrower than the 12-month moving average median discount (3.69%). In this report, we highlight November 2021 CEF performance trends, premiums and discounts, and corporate actions and events.
Highlights
- For the second month in three, equity CEFs on average witnessed negative returns, falling 2.61% on a NAV basis for November, while for the first month three fixed income CEFs posted returns in the black (+0.12%).
- Thirty-six percent of all CEFs traded at a premium to their NAV, with 34% of equity CEFs and 38% of fixed income CEFs trading in premium territory. The world income CEFs macro-classification witnessed the largest widening of discounts for the month among Lipper’s CEF macro-groups—150 bps to a 0.94% median discount.
- Real Estate CEFs (+0.38%) for the first month in four posted the strongest one-month returns of the equity classifications in the CEF universe for November.
- For the first month in seven, the High Yield Municipal Debt CEFs (+1.80%) classification posted the strongest plus-side returns in the fixed income CEF universe for October.
- The municipal bond CEF macro-group (+1.46%) posted a gain for the first month in four, with all nine classifications experiencing plus-side performance.
Download our Closed-End Funds FundMarket Insight Report: The Month in Closed-End Funds: November 2021 here.
Refinitiv Lipper delivers data on more than 330,000 collective investments in 113 countries. Find out more.
