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Started by Tedo, September 16, 2018, 09:56:53 AM
Quote from: Triple - Nickels on September 18, 2018, 02:40:49 PMSam,You're have a big stash of CMF in your portfolio, what's your take on why CMF has declined 1% in the past week?Thanks,Triple-Nickels
Quote from: ptkelly on September 25, 2018, 05:26:42 AMPay attention to the price discount to NAV on closed end funds. Sites such at CEFconnect.com will show you the historical trends and averages. Best to wait to buy a CEF when the discount is below a relevant historical average.A lot of CEFs employ leverage which magnifies their move versus a comparable unleveraged ETF such as the muni ETF MUB. Not sure what PIMCO's leverage ratio is but Nuveen's comparable muni CEF NEA employs about 30% leverage.So not only will this magnify the moves in NAV and therefor the correlated price move, but the market may more aggressively sell/buy the CEF in response to those changes thus impacting the market price discount to NAV.A good example is the preferred ETF PFF versus the Nuveen preferred closed-end fund JPC. JPC has suffered pretty greatly from a modest 5% decline in "underlying" PFF ETF compounded by a widening of its discount to NAV to 11%+ for a total ~12% price decline. PFF is yielding about 5% whereas JPC is yielding ~7% due to leverage but that yield advantage has been more than wiped out to market price action.
Quote from: Sam on September 16, 2018, 09:58:51 AMMUB is one of the largest national muni bond funds. CMF is one pertinent to California to save on state taxes as well as federal.