Published Fri, 18 Dec 2020 14:56:31 -0500 on Seeking Alpha
Seeking AlphaClosed End FundsTekla World Healthcare Fund: High-Yield, High-Expense, Tax-Effective FundDec. 18, 2020 2:56 PM ET|| About: Tekla World Healthcare Fund (THW), Includes: BME, GRX, THQby: Michael A. Gayed, CFAMichael A. Gayed, CFA The Lead-Lag ReportAnticipate Corrections and Volatility with Award Winning ResearchSummaryTHW is a non-diversified closed-end fund traded on the NYSE.
Invests in equities as well as debt securities.
One of the highest-yielding funds amongst peers with a TTM dividend yield of 8.96%.
Without passion you don't have energy. Without energy, you have nothing - Warren Buffett
Tekla World Healthcare Fund (NYSE: THW) employs a versatile growth and income investment strategy investing across all healthcare subsectors and a company's full capital structure. It invests at least 40% of AUM in ex-U.S. companies or those with substantial ex-U.S. revenues.
The current pandemic will serve as a strong catalyst for the healthcare sector, as governments and institutions increase investments in these companies in the future.
Another significant advantage of investing in an equity closed-end fund such as THW is the tax aspect. Distributions made by the fund in dividends are not subject to tax at the time of distribution. Instead, an investor-only gets taxed when he decides to sell his investment. In such a case, the dividends are taxed as capital gains. Investors can, therefore, theoretically defer taxation on distributions indefinitely if they decide to hold onto their investments.
The fund's AUM is ~$471mm, and it has a trailing dividend yield of 8.96%, the highest amongst its peers. However, investors should be aware of this fund's high expense ratio (1.86%).
Constituent Holdings About 74% of THW's exposure is to healthcare equities. Within the healthcare sector, THW invests in biotechnology, pharmaceuticals, healthcare equipment, healthcare supplies, life science tools and services, healthcare distributors, managed... Read more
|Stock name||Last trade||P/E||Earnings/Share||Dividend/Share||Dividend yield|
|BLACKROCK HEALTH SCIENCES TRUST||38.18||0.0||0.00||0.00||6.26|
|GABELLI GLOBAL HEALTHCARE & WELLNESSRX TRUST||10.70||0.0||0.00||0.00||5.24|
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