How We Generate Excess Returns

There are two fundamental reasons why our strategy has the potential to generate excess returns:

  1. Buying income vehicles at a discount
  2. Capitalizing on the discount narrowing of a closed-end fund

Alpha Sources Unique to Closed-End Funds

A Strategy for the Present and the Future

There are three core reasons why our strategy can work for the long-term:


  • New closed-end funds’ IPOs are consistently coming to market, consistently providing new supply.
  • Fear and greed are timeless. Closed-end funds are primarily owned by retail investors. Their notoriously highly emotional investing style consistently creates attractive and lucrative opportunities for our strategy.
  • Total asset size of the closed-end funds market is approximately $222 billion with 540+ funds. The limited capacity-liquidity of this market prevents:
    • Large financial institutions from allocating a portion of their assets to closed-end funds.
    • Sizeable asset management firms from entering and dominating the closed-end fund market with large block trades.