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Dividend And Income Fund: High Income Closed-End Fund With Discount Capture 'Alpha'

Published Thu, 07 Jan 2016 11:51:15 -0500 on Seeking Alpha

This is a good time of the year to look for closed-end funds that may have been depressed by tax loss selling. There is seasonal tendency for many of these funds to rally the first few months of the year.
The Dividend and Income Fund (NYSE: DNI) was formed in June, 1998. It is a global balanced fund that currently invests about 90% in equities and the remainder in cash or fixed income. The fund's primary objective is to seek high current income. The fund uses a modest amount of leverage.
The fund's investment manager, Bexil Advisers LLC, is a subsidiary of Bexil Corporation (OTCPK: BXLC). Bexil is a very small firm, somewhat off the radar screen of Wall Street. They own about 6% of the outstanding shares of DNI.
When selecting equity securities, the fund managers normally emphasize those with a yield greater than the average dividend yield of the S&P 500.
(Data below is sourced from the fund's website unless otherwise stated.)
The equity portion of the fund invests globally with an emphasis on large and mid cap stocks. The small fixed income portion of the portfolio is designed to generate high current income. In the last shareholder report, the fund managers were invested in high yield corporate bonds, preferred stocks, REITS and MLPs.
The fund is allowed to write covered call options to generate additional income, but they were not doing so as of the last report.
There could be a swing trading opportunity right now in DNI. The discount... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
DIVIDEND ANDOME FUND 12.00   0.0 0.00 0.00 6.67


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