Core Insights - Closed-end funds (CEFs) are currently seen as undervalued investment opportunities, often trading at discounts to their net asset values (NAVs), making them attractive for contrarian investors [2][3] High Yield CEFs: Eaton Vance Tax-Advantaged Dividend Income Fund (EVT) - EVT invests in both common and preferred stocks, focusing on qualified dividends that are taxed at favorable long-term capital gains rates [4] - The fund currently yields 8%, significantly higher than the typical 2% yield of standard dividend funds, partly due to a leverage of about 20% of assets [6][7] - EVT trades at an 8% discount to NAV, wider than its historical average of 5% [9] High Yield CEFs: Eaton Vance Tax-Managed Buy-Write Opportunities (ETV) - ETV employs a covered call strategy, holding a portfolio of 150 large-cap stocks and generating income through selling covered calls on major market indexes [11] - The fund trades at approximately 94 cents on the dollar, providing a cost-effective way to gain exposure to its monthly distributions [12] High Yield CEFs: BlackRock Enhanced Global Dividend Trust (BOE) - BOE has a diversified portfolio of about 50 stocks, split between U.S. and international equities, focusing on blue-chip companies [13][15] - The fund yields over 8%, supported by a covered call strategy, and currently trades at an 8.7% discount to NAV, which is less than its long-term average of 11% [16] High Yield CEFs: BlackRock Resources & Commodities Strategy Trust (BCX) - BCX invests in stocks of commodity and natural resources companies, maintaining a portfolio of 45 companies across energy and materials sectors [17] - The fund is currently available at a 6% discount, which is less attractive compared to its long-term average discount of 10% [18] High Yield CEFs: ClearBridge Energy Midstream Opportunity Fund (EMO) - EMO focuses on midstream energy companies, yielding nearly 10% and utilizing high leverage of about 30% to enhance returns [19][21] - The fund has outperformed its benchmark, the Alerian MLP Index, since 2023, but trades at a premium compared to its historical average discount of 15% [23]

Group 1 - The article discusses the author's investment journey, starting in high school in 2011, focusing on REITs, preferred stocks, and high-yield bonds, indicating a long-standing interest in markets and the economy [1] - The author has recently adopted a strategy that combines long stock positions with covered calls and cash secured puts, emphasizing a fundamental long-term investment approach [1] - The author primarily covers REITs and financials on Seeking Alpha, with occasional articles on ETFs and other stocks influenced by macro trade ideas [1]

Core Insights - The article discusses the implications of persistently low volatility, particularly as measured by the CBOE Volatility Index (VIX), on options trading strategies and market behavior [3][4][10] - It highlights that low volatility can lead to inflated expectations for options strategies, especially covered call ETFs, and suggests that a rise in VIX could be beneficial for options sellers [4][10] Volatility and Market Behavior - Low volatility typically correlates with stable or rising stock prices, while high volatility is often associated with market declines [3] - The VIX has remained low over the past three years but is susceptible to sudden spikes, which can disrupt options strategies [2][5] Options Trading Strategies - The article emphasizes the challenges faced by options sellers in a low VIX environment, where the compensation for taking on risk is diminished [4][8] - It discusses the use of covered calls and collars as strategies to manage risk, but notes that the current low VIX results in minimal returns for these strategies [6][9] Market Indicators - The article suggests that volatility may be nearing a bottom, as indicated by technical analysis tools like the Percentage Price Oscillator (PPO) [4][5] - It warns that volatility often spikes without warning, making it crucial for traders to anticipate these movements [5] Conclusion - The article concludes that options sellers may benefit from a rise in VIX, as higher volatility would lead to better compensation for risk [10]

Group 1 - The article discusses the author's journey into investing, starting in high school in 2011, focusing on REITs, preferred stocks, and high-yield bonds, indicating a long-standing interest in markets and the economy [1] - The author has recently adopted a strategy that combines long stock positions with covered calls and cash secured puts, emphasizing a fundamental long-term investment approach [1] - The author primarily covers REITs and financials on Seeking Alpha, with occasional articles on ETFs and other stocks influenced by macro trade ideas [1]

Group 1 - The article discusses the author's journey into investing, starting in high school in 2011, focusing on REITs, preferred stocks, and high-yield bonds, indicating a long-standing interest in markets and the economy [1] - The author has recently adopted a strategy that combines long stock positions with covered calls and cash secured puts, emphasizing a fundamental long-term investment approach [1] - The author primarily covers REITs and financials on Seeking Alpha, with occasional articles on ETFs and other stocks influenced by macro trade ideas [1]

Group 1 - The article discusses the author's journey into investing, starting in high school in 2011, focusing on REITs, preferred stocks, and high-yield bonds, indicating a long-standing interest in markets and the economy [1] - The author has recently combined long stock positions with covered calls and cash secured puts, emphasizing a fundamental long-term investment approach [1] - The author primarily covers REITs and financials on Seeking Alpha, with occasional articles on ETFs and other stocks influenced by macro trade ideas [1]