Weather Report for Closed-End Funds

It has been a turbulent summer for closed-end funds, and the investment climate is still quite unsettled. The following is our take on the current weather and forecast for changing conditions, along with where we think investors can take advantage of climate change.

Closed-End Fund Discounts Widen as Investors Overreact to Rise in Interest Rates

Because there is an inverse relationship between bond prices and interest rates, the recent rise in rates has triggered a decline in bond prices, hitting closed-end funds particularly hard. In fact, closed-end funds have suffered from two forms of overreaction.

Watching the Forest AND the Trees

Investors often ask us for the best way to approach closed-end fund investing. Does the traditional buy-and-hold strategy provide the best results or is active trading preferable?

Remaining Agile: Closed-End Funds Prepare for the Future

A key advantage of closed-end funds over open-end mutual funds is that portfolio managers are free to trade underlying holdings when they see fit.

The Other ā€œDā€ Word in Closed-End Funds

When investors think closed-end funds, the word discount often comes to mind.

Past performance is not a guarantee of future results.

Virtus Investment Partners provides this communication as a matter of general information. The opinions stated herein are those of the author and not necessarily the opinions of Virtus, its affiliates or its subadvisers. Portfolio managers at Virtus make investment decisions in accordance with specific client guidelines and restrictions. As a result, client accounts may differ in strategy and composition from the information presented herein. Any facts and statistics quoted are from sources believed to be reliable, but they may be incomplete or condensed and we do not guarantee their accuracy. This communication is not an offer or solicitation to purchase or sell any security, and it is not a research report. Individuals should consult with a qualified financial professional before making any investment decisions.