| Bonds Online |
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| 5/10/2013Market Performance |
| Municipal Bonds |
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S&P National Bond Index
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3.00% |
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S&P California Bond Index
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2.96% |
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S&P New York Bond Index
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3.13% |
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S&P National 0-5 Year Municipal Bond Index
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0.70% |
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| S&P/BGCantor US Treasury Bond |
400.09 |
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| Income Equities: |
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| Preferred Stocks |
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S&P U.S. Preferred Stock Index
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848.03 |
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S&P U.S. Preferred Stock Index (CAD)
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636.26 |
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S&P U.S. Preferred Stock Index (TR)
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1,701.05 |
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S&P U.S. Preferred Stock Index (TR) (CAD)
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1,276.26 |
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| REITs |
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S&P REIT Index
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174.07 |
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S&P REIT Index (TR)
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425.30 |
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| MLPs |
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S&P MLP Index
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2,469.58 |
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S&P MLP Index (TR)
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5,428.50 |
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See Data
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CEF Thoughts From the Morningstar ETF Invest Conference |
MORNINGSTAR - Sept. 23, 2011 - By Cara Esser
Some of most exciting and pioneering investment strategies can be found within CEFs.
Morningstar hosted its second-annual ETF Invest Conference this week in Chicago. The conference kicked off Wednesday afternoon with a decidedly positive outlook on the current state of affairs by First Trust's chief economist Brian Wesbury. (You can read about his presentation here.) The conference focused on broad themes in the macroeconomy (most notably the struggling recovery), as well as more focused discussions on tactical and strategic ETF investing.
As I sat in the discussions, my thoughts often turned to closed-end funds, or CEFs. Perhaps the most striking topic was "New-Wave Alternatives." (You can read a recap of the discussion here.) During the panel, I often heard the words "pioneering" and "exciting" used to reference the alternative strategies. Such words are not often used to describe CEFs, which are commonly--and incorrectly--perceived as old, stodgy investment vehicles that primarily buy and hold municipal bonds. Yes, CEFs are old--the first was launched in the United Kingdom in the late 1800s--and yes, currently 254 of the 632 CEFs invest in municipal bonds. But those of us in the know realize that these investment vehicles are far from uninteresting. In fact, the bulk of CEFs employ a wide array of investment strategies, even including some alternative and hedge-fund-like strategies. And, we've seen recent activity in CEF IPOs from hedge fund companies and new funds implementing hedge-fund-like strategies.
While the definition of "alternative strategy" is open to interpretation, Morningstar defines alternatives using three buckets: nontraditional asset class, nontraditional strategies, and investment in illiquid products. There are numerous CEFs falling nicely into each of these buckets.
Nontraditional Asset Class
A discussion of alternatives must include commodities, specifically gold and silver. These precious metals have received increasing publicity this year as inflation fears continue to fuel a buying spree. Six CEFs invest solely in commodities, four directly in gold and silver. The most widely traded CEF, in fact, holds gold and silver bullion: Central Fund of Canada (CEF) . This fund, along with Central Gold Trust (GTU) , Sprott Physical Gold (PHYS) , and Sprott Physical Silver (PSLV) , takes physical possession of gold, and in the case of PSLV, silver bullion. These funds have been gaining popularity and growing in size as gold and silver prices have skyrocketed.
Comparing the funds with the most widely traded gold ETF, SPDR Gold Shares (GLD) , the funds hold their own. CEF and GTU, for example, charge fees that are slightly lower than GLD's 0.40% expense ratio, yet the funds have a similar performance record: Over the past year, CEF's net asset value is up 21%, GTU up 28%, and GLD up 25%; and over the latest three-year annualized period, CEF is up 25%, GTU up 30%, and GLD up 26%.
For the complete article.
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Income Security Recommendation January 2013 Issue.
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