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Non-Tech : CEF Closed End Fund Investing

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From: shadetreethinker	4/22/2012 12:49:48 AM
	1 Recommendation Read Replies (2) of 62

Flaherty and Crumine Preferred Income Opportunity Funds (PFO) changing the makeup of their fund. In their proxy statement for this year's annual meeting, F&C is recommending shareholders vote in favor of removing the fund's requirement that 25% of its portfolio contain utility preferreds. Their reasoning is less than 5% of offered preferreds are by utilities making a difficult to maintain the requirement. They believe shareholders would be better served if the restriction was removed. I gave them my vote. I was unaware how small the preferred utility sector was. If the motion passes and the fund no longer has to have 31 million in utilities, I wonder it that will open up some opportunities for individual preferred investors. I bought the fund in early January of 09 when everyone seemed to hate CEFs and the fund was trading at a pretty deep discount. It currently trades at a 10% premium. If you've thought about preferred, but didn't want to do the research, Flaherty and Crumine CEFs could be what your looking for when they shift back to a discount to NAV. The firm deals strictly in preferreds and have been in business since 1983. They have 4 U.S. CEFs and 1 Canadian.

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