“Stocks follow profits” is the mantra for Artisan Fund’s investment philosophy; th...
A "Core" Play for Equity Alpha
06/25/2020 5:00 am EST
Nuveen Core Equity Alpha Fund (JCE) has an investment objective to provide an attractive total return, largely through long-term capital appreciation, income, and gains, explains dividend expert Marty Fridson, editor of the Forbes/Fridson Income Securities Investor.
The fund is unleveraged and invests in a portfolio of actively managed equities, selected from the stocks that constitute the S&P 500 Index. To enhance risk-adjusted performance JCE employs a strategy of selling call options with a notional value capped at 50% of the equity portfolio.
Large cap equities account for 99.9% of the fund’s holdings, with Health Care Equipment & Supplies (7.4%), IT Services (7.0%), Equity REITs (5.9%), Specialty Retail (5.2%), and Oil, Gas, & Consumable Fuels (5.1%) making up the top five industries on 12/31/19.
Returns have been strong historically, with JCE posting a market price total return of +30.43% in 2019. To date, performance in 2020 has been challenging.
Through 03/31/20 JCE reported a YTD market price total return of -24.90%. With the idea taking hold that a recovery is not far off, however, we expect this fund to perform well over the near term.
Distributions have been taxed largely as qualified and ordinary income. This investment is suitable for low- to medium-risk portfolios. Buy up to $17.50 for an annualized 5.71% yield.
Related Articles on FUNDS
June and July were especially rough on infrastructure investments, especially the midstream energy b...
Municipal bonds — which are issued by states and cities — are known for two things: low ...
Reaves Utility Income Fund (UTG) is a diversified closed-end fund (CEF) that owns 41different utilit...