My latest article on Seeking Alpha is about learning to keep your investment philosophy and your strategy simple so that you can focus on more important things while knowing your portfolio is doing its job. Please read The Best Investment Strategy Is Simple and be sure add your two cents in the comment thread. I always appreciate a good discussion.
I've published two articles this month on Seeking Alpha, both covering the topic of searching for alternate choices for bond funds. In these articles, I share my dilemmas and my decision-making processes when comparing closed-end funds.
The first one addresses comparing the high-yield bond choices available today at attractive valuations: Evaluating Similar High-Yield Bond CEFs
The second one addresses finding an investment grade bond CEF that focuses primarily on US Treasuries and other government bonds:
Finding A Good Government Bond CEF Ain't Easy
Be sure to chime in with your questions and comments in the discussion thread.
Thanks for reading.
My e-course Perpetual Income With Closed-End Funds is up and running! Pre-launch sign-ups got first crack at the course before my public offering and this is what the very first student had to say:
"A Simply Superb Primer on Closed End Funds"
"I just finished this course and I am glad to write this review. The author has covered every aspect of CEFs and went above and beyond by including spreadsheets and a lot of other documents and checklists that will be immensely useful in CEF portfolio management. After finishing the course I am convinced to move my portfolio into closed-end funds as my mindset has changed from capital growth to accumulating shares for income. Anyone on the fence regarding investing in CEFs must check this out." ~ Sam K.
Read the full description at Faithful Steward Academy. Questions are welcome.
I recently surveyed some of Seeking Alpha's Closed-End Fund experts and contributing authors, and the responses to these "virtual interviews" reveal some of the most telling nuances of closed-end fund investing.
You can read my article What's So Great About CEF Investing - Author Interviews here: https://seekingalpha.com/article/4164562-great-cef-investing-author-interviews
Thanks for reading.
I have been steadily working on my first premium e-course Perpetual Income With Closed-End Funds in my spare time, and we're finally on the downhill stretch. I ran into a lot of bumps in the road, but things are finally coming together. It will definitely be ready for open enrollment in April. Thank you for your patience.
For now, I am redirecting my focus to prepare for family festivities for the upcoming Easter holiday and subsequent Spring Break. Looking forward to this special time.
For those of you who have already pre-registered, I will be sending out an email when the course is published on Faithful Steward Academy. I plan to give my pre-registrants a special deal for signing up before the course was even completed as a special thank you.
This is just a quick note to let readers know that I have been working on the e-course version of Perpetual Income With Closed-End Funds, which will include the same material as the book, along with review questions to confirm a grasp of the material, and some actionable steps and checklists. I was aware that this project was going to take some time and effort, but it is proving to be much more labor-intensive than I had anticipated.
I continue to plug away at its creation every day, so don't give up hope. I am aiming for the end of March to publish.
As always, I welcome any comments, questions, or suggestions you may have.
To subscribe, please go here to sign up for first dibs on this course.
Please Note: this blog post originally appeared on Seeking Alpha and is specifically meant for followers of my Personal Perpetuity Portfolio as outlined in my ebook .
Whenever my CEF positions get far enough off their target sizes, I like to take a closer look to see if it's time to rebalance with another fund. Stone Harbor Emerging Markets Income Fund (EDF) is one such fund. The recent run-up in price pushed it beyond its target size for my portfolio, so it's time to take a closer look. While I don't like switching shares from a higher-yielding fund to a lower-yielding one, in this case, I believe it would be a prudent move.
For one thing, EDF is trading at a premium, although a tolerable one. Most of my other funds are trading at discounts. I usually don't worry too much about premiums of 10% or less, but what concerns me is that if the current distribution rate at market is over 13%, then obviously the DR at NAV is well over the red-flag threshold of 12%.
Taking a quick look at CEFconnect, the 12-month return on NAV as of yesterday (2/14/18) is 12.45%. This is under the NAV yield of 14.98%. Not a huge difference there, and the recent pullback is a factor in the return figure. In and of itself, this 2.5% under-earning would not concern me.
However, comparing the earnings per share (as of 11/30/17) of .1190 to the distribution per share of .1800 is cause for concern. Moreover, the earnings don't even cover the portion of the distribution strictly from income.
All these factors together may add up to trouble. I believe that caution is warranted. Admittedly, I have not recently studied the fund in-depth, but a cursory glance says to trim the position and watch it closely.
If it does end up cutting its distribution, the market price will pull back on the selloff, and that would be a better time to load back up on some more shares.
In the meantime, caveat emptor.
My latest article has been published on Seeking Alpha. In it, I discuss the importance of having a portfolio allocation ratio to help keep you objectively on course with your investment goals. There are several examples to choose from to help get you started.
To read the article, go to:
Your Portfolio Allocation Ratio: Charting A Course Toward Your Goals
Remember to chime in with your own comments or questions.
Welcome to the new home of Faithful Steward Investing!
As most of you already know, I decided to change from FSI's previous model of Paying a Lot of Money to Offer Free Content to a new, more sustainable model of offering both free and premium content in what I hope proves to be a more helpful and actionable format.
Most of the material on the old website is now available in free e-courses at Faithful Steward Academy. Some of the material will be developed further into actionable content through premium e-courses and/or digital books.
This new direction will allow me to: 1) focus on developing material that will be more beneficial to my readers, and 2) continue to pursue a subject I enjoy writing about: income investing with closed-end funds. All my articles on Seeking Alpha are available to read free of charge.
(UPDATE: Seeking Alpha changed its policy in February 2018 to put articles that are focused on specific ticker symbols behind a paywall after 10 days. This will make some of my articles, and most other authors' articles, inaccessible in their free platform. I will do my best to use whatever means necessary to keep my articles free.)
I am also open to offering content in e-book format. If you have a preference, I'd like to know. Please chime in with your opinion or ideas in the comments (see sidebar). All feedback helps me create better products for my fellow faithful stewards.
Looking forward to hearing from you!