Muni Closed-end Funds

A portfolio of municipal closed-end funds that generates a federal tax-exempt yield for US investors.

Strategy Description

Though not an ETF portfolio, our Municipal bond Closed-End Fund portfolio offers similar exchange-traded and diversification benefits to investors.

Muni CEFs offer a yield advantage to Municipal ETFs because they a)utilize leverage, and b) can be purchased at a material discount to fair value.

We review the entire universe of Municipal Closed-End Funds to identify those with the best potential for performance, least credit risk, least duration and leverage, and highest yield.

This portfolio is materially less liquid than municipal ETFs and discounts to fair value can always get worse before getting better, thus creating more short-term volatility than directly-held municipal bonds or municipal ETFs. However, the compensation for the risk is materially higher yield.

For the long-term investor seeking to improve tax-exempt yield, this is a portfolio worth reviewing. 

Allocation Breakdown

Asset Class


Equity0
Fixed Income99.42%
Commodities0
Cash0.58%

Geo


America100%

Sector


Investment Grade60%
High Yield5.52%
Other34.48%

Top Holdings

Asset ClassWeight (%)
1. BNY Mellon Strategic Municipals Inc20.29%
2. AllianceBernstein National Municipal Income Fund Inc20.25%
3. BlackRock MuniYield Quality Fund III Inc19.69%
4. Eaton Vance Municipal Income Trust19.63%
5. BlackRock Municipal Income Fund Inc19.56%