The universe of closed-end funds (CEFs) attracts investors because of the high yields many pay. The Amplify CEF High Income ETF (YYY) is a fund of funds giving you exposure. Structured as an ETF, it holds a select portfolio of CEFs, observes Tim Plaehn, editor of The Dividend Hunter.
I’ve been known to call the CEF world the “junkyard of Wall Street.” Closed-end fund sponsors do not redeem shares from investors; rather, once shares are issued, they trade only on stock exchanges. So, a CEF fund sponsor with an underperforming fund continues to earn management fees, no matter how poorly the fund performs.
(Editor’s Note: Tim is speaking at our 2026 MoneyShow Masters Symposium Las Vegas, scheduled for July 19-22. Click HERE to register.)
Amplify CEF High Income ETF (YYY)
And there are many poorly performing CEFs. I often tell my subscribers that I know there are gold nuggets in the CEF world, yet I don’t have time to dig through the 400-plus available CEFs. But YYY holds 60 CEFs, diversified by asset class and CEF issuers. The portfolio CEFs are purchased at discounts to NAV, offering appreciation potential while also earning a high average yield.
Overall, the YYY portfolio holds 50.1% in bond-focused CEFs, 37.1% in stock funds, and 12.7% in hybrid (holding both stocks and bonds) funds. YYY has paid a 12 cent-per-share monthly dividend since August 2021— an almost five-year stretch. The current distribution rate is 12.4%.
Bottom line: I think YYY would be a better way to invest in CEFs rather than looking for individual funds.
