Spread out your opportunities and your risk with this pair of quality closed-end funds that hold some of the world's top income stocks, notes Richard Lehmann of Income Securities Investor.
Blackrock Global Opportunities Equity Trust's (BOE) objective is to seek current income and current gains, with a secondary objective of long-term capital appreciation.
It aims to achieve these objectives by investing at least 80% of its total assets in equity securities or options on equity securities or indices or sectors of equity securities. Securities in which the Trust anticipates investing include both foreign and domestic common stocks, preferred stocks, convertible securities, warrants, depository receipts, and equity interests in REITs.
As of June 29, the top five stock holdings in the fund were ExxonMobil, Apple, British American Tobacco, Wells Fargo, and General Electric. Top sectors were financial, information technology, consumer staples, health care, and consumer discretionary. All in all, this is an excellent fund for medium-risk portfolios seeking global exposure.
Flaherty & Crumrine/Claymore Preferred Securities Income Fund's (FFC) investment objective is high current income consistent with preservation of capital.
It invests at least 80% of its total assets in a diversified portfolio made up of principally investment-grade, hybrid taxable preferred securities. The fund intends to pursue hedging strategies that it expects will result in income increasing in response to significant increases in long-term interest rates while being relatively resistant to the impact of declines in long-term interest rates.
Currently, 40% of their assets are in the bank sector, 23% in utilities, and 26% in insurance securities, as well as 6% in energy. Their top five holdings as August 31 were Liberty Mutual, Banco Santander, Metlife, Capital One Financial, and HSBC.
The fund's top ten investments represent 30% of its assets. We have recommended this fund several times before for its strong income and the quality of its investments. This is a good investment for low-risk income investors.