Closed-End Fund Report Highlights High-Yield, Strong Coverage, and Discount to NAV

The article discusses a "Triple-Factor" Closed-End Fund Report, which is a systematic approach that screens for three key attributes: high yield, strong coverage, and discount to net asset value. The report is renamed from the "High-High-Low" CEF Report to better reflect its methodology.

The "Triple-Factor" Closed-End Fund (CEF) Report, previously known as the "High-High-Low" CEF Report, has been renamed to better reflect its systematic screening methodology. This report identifies funds that meet three critical criteria: high yield, strong coverage, and a discount to net asset value (NAV). The report, released on August 8, 2025, offers a detailed analysis of the top-performing CEFs based on these factors.

The Triple-Factor screen identifies funds with substantial yields (above 7.5%), strong distribution coverage (above 90%), and value opportunities (trading at a discount to NAV). Coverage ratios are calculated using the latest trailing coverage numbers from the fund's unaudited monthly estimates for major fund houses, with other funds using earnings data from their latest annual or semi-annual reports. This approach ensures that investors have access to the most current information available.

The report ranks funds based on various metrics, including the widest discounts, best z-scores, highest yields, and the best combined yield and discount. For instance, the Highland Opportunities and Income Ord (HFRO) Senior Loans fund stands out with a -48.77% discount and a 7.74% yield, making it one of the most attractive options for investors seeking high income and significant value.

Key metrics and rankings include:
- Top 10 Widest Triple-Factor Discounts: Funds like Highland Opportunities and Income Ord (HFRO) and ArrowMark Financial Corp (BANX) offer substantial discounts, providing potential for price appreciation and enhanced yield.
- Top 10 Best Triple-Factor Z-Scores: Funds such as Eaton Vance Senior Floating Rate (EFR) and Morgan Stanley Emerging Markets Debt (MSD) have negative z-scores, indicating potential buying opportunities.
- Top 20 Highest Triple-Factor Yields: The Invesco Senior Income (VVR) fund leads this category with a yield of 12.46%, highlighting the potential for high income.
- Top 10 Best Combined Triple-Factor Yield and Discount: The report ranks funds based on the combination of yield and discount, identifying funds like Highland Opportunities and Income Ord (HFRO) and ArrowMark Financial Corp (BANX) as top performers.

Investors should note that higher yields can indicate higher risk, and it is essential to consider the premium/discount valuation of these funds. Additionally, the report serves as a preliminary shortlist for further research and due diligence, and should not be considered the final analysis for a buy or sell decision.

For more detailed information, please refer to the original report [1] https://seekingalpha.com/article/4815739-triple-factor-closed-end-fund-report-august-2025-stanford-chemist.

References:
[1] https://seekingalpha.com/article/4815739-triple-factor-closed-end-fund-report-august-2025-stanford-chemist