CEF Weekly Review: Proxy Advisers Enter The Saba / BlackRock Battle

Market Action - CEF discounts have tightened and are now close to their long-term average levels [3] - Blackstone increased the distribution of their loan CEF BGB by 9% to $0.101, showing significant variability in its distribution history [5][6] - CLO CEFs experienced a positive month in May, with all fund NAVs rising and several funds trading at double-digit premiums [6] Market Themes - A number of managers are actively working to tighten discounts, contributing to the strength of discounts in the market [8] - The CEF market showed mixed performance, with Muni sectors outperforming due to a decline in Treasury yields following soft inflation data [11] Market Commentary - Proxy advisers are involved in the ongoing Saba and BlackRock conflict, with ISS supporting Saba's efforts to change board members while also recommending BlackRock nominees for other funds [12] - Glass Lewis recommended reelecting all of BlackRock's board nominees, stating that Saba has not made a compelling case for its proposed changes [12] - The competition between Saba and BlackRock is seen as beneficial for the CEF market, prompting BlackRock to implement shareholder-friendly actions [12]