This 12% CEF Could Be Gen Z's Next Investing Obsession

Group 1 - The core idea is that stock prices can rise based on speculation and hype, but ultimately, profits are the key driver for sustainable stock value [2][3] - Peloton Interactive (PTON) serves as a case study where initial stock gains during the pandemic were not supported by actual profits, leading to a decline in stock value as investor optimism waned [3][4] - The article highlights the potential for closed-end funds (CEFs) to be profitable investments, particularly when purchased at a significant discount to net asset value (NAV) [5][7] Group 2 - There is an emerging trend among younger investors, particularly Generation Z, who are increasingly interested in dividend-paying investments rather than high-risk assets [8][9] - Bloomberg reports that Gen Z is shifting focus from volatile investments to more stable dividend strategies, which emphasize control and consistency [8][9] - The YieldMax TSLA Option Income Strategy ETF (TSLY) is mentioned as an example of a high-yielding investment that has attracted significant assets, despite its relatively low total return over three years [9][10] Group 3 - The article suggests that as young investors begin to appreciate dividends, they may eventually seek more sustainable high-yield options, such as the BlackRock Science and Technology Term Trust (BSTZ), which offers a 12% yield [10][11] - BSTZ is noted for its strong performance and trading at a discount to NAV, making it an attractive option for savvy investors [11] - The expectation is that as Generation Z recognizes the value of funds like BSTZ, demand will increase, potentially boosting the fund's market price and narrowing its discount [11]