Income Millionaire's Closed-End, High Yield Trio

Focus: Funds

Igor Greenwald Image Igor Greenwald Chief Investment Strategist, MLP Profits

Income expert Igor Greenwald, is the editor of Investing Daily's newest dividend-focused advisory Income Millionaire; here, he looks at a trio of high-yielding closed-end funds.

The Eaton Vance Tax-Advantaged Dividend Income Fund (EVT) is a closed-end fund that invests primarily in blue-chip dividend paying U.S. stocks.

Top holdings include JPMorgan Chase (JPM), Wells Fargo (WFC), Johnson & Johnson (JNJ) and General Electric (GE), along with a ETF specializing in preferred stocks.

Like many closed end funds, EVT juices its dividend income and capital gains with a bit of leverage, in its case amounting to 22% of the portfolio’s $1.6 billion in net assets.

EVT pays a regular monthly distribution of 14.5 cents per share, which works out to $1.74 annualized, or 8.1% of the current price. That price is 3% below net asset value. NAV increased 11.6% last year and is up 4.5% so far in 2017. The expense ratio is 1.47%, which includes 0.29% in borrowing costs.

The Eaton Vance Tax-Advantaged Global Dividend Opportunities Fund (ETO) is very similar, except that it applies its 26% of leverage to a more diverse set of investments, including a 32% allocation to foreign stocks, and roughly 20% divvied up among preferred stocks and corporate bonds, investment grade as well as high yield.

The fund’s top recent holding, Alphabet (GOOGL) doesn’t even pay a dividend, but since it’s up 17% year-to-date no one is complaining, in all likelihood.