Closed-End Dividend Stock Funds Offer Good Income At a Discount

Everyone loves a bargain. So if you are looking for high-yield, income investments that are on sale at great discounts, try closed-end dividend stock funds. Unlike open-ended mutual funds, closed-end funds issue fixed number of shares so their prices are determined by supply and demand. Therefore, at times, closed-end funds can trade at discounts to the total value of their portfolio holdings.

Currently many dividend-oriented closed end funds (table) are trading at significant discounts, pushing up their dividend yields and making them attractive candidates for income investors. Many of these funds pay their cash distributions each month. But before you buy a fund, check its fees because they will reduce your return.

Closed-End Dividend Stock Funds
Closed-End Fund and Web Site	Quote	Yield	Discount to NAV
BlackRock Dividend Achievers™ Trust	BDV	7.58%	11.92%
BlackRock Enhanced Dividend Achievers™ Trust	BDJ	10.48%	5.84%
BlackRock Strategic Dividend Achievers™ Trust	BDT	7.48%	13.61%
Dreman/Claymore Dividend & Income Fund	DCS	8.31%	13.96%
ING Global Equity Dividend and Premium Opportunity Fund	IGD	10.99%	2.80%
Nuveen Tax Advantaged Dividend Growth Fund	JTD	10.16%	12.00%
NOTE: Data are from fund Web sites as of May 3, 2008.

Related Articles:

Closed-End Funds
High-Yield Exchange-Traded Funds Are Attractive Additions to an Income Portfolio
Six Large High-Yield Closed-End Funds
Why Dividends Matter

Updated May 4, 2008.