Recently, it has been more difficult to find high yield closed-end funds because the search for yield has increased the share prices. Now is probably a good time to consider slowly picking up high yield CEFs that have pulled back with the market. I reccomend you slowly add positions over time due to the negative market perception. This perception is overblown due to politics and uncertainity of increasing interest rates.
The VIX is the stock market’s fear gauge. A falling VIX indicates investor complacency. A rising VIX shows fear. The spike in the VIX indicates that the market is due for a bounce. Recently, the VIX closed above its upper Bollinger Band – indicating an extreme move in investor fear. Of course, we all know the best time to buy stocks is when investors are scared – when they’re so frightened of potential losses, they’re willing to dump positions at “fire sale” prices.
I think this is a good time to enter or increase positions in monthly income stocks. You may want to dollar-cost average into these positions over time. Here is a list of CEFs with 10% or higher yield.
