| | | DSM Weekly CEF Summary
Valuation, Income Durability & Weekly Trend Review (Data-Backed)
1. Market Regime Snapshot (Data Evidence) - NAV stability:
Across the universe, Current NAVs remain within recent ranges. No fund shows NAV drawdowns approaching 52-week lows.
- Example:
- ADX: $24.73 vs 52-wk low $18.97
- BST: $43.21 vs 52-wk low $31.27
- BME: $44.25 vs 52-wk low $37.85
> Confirms no systemic NAV stress this week.
2. Premium Funds — Absolute vs Relative Valuation
GOF
Absolute valuation (today):
- Current premium: +12.49%
- Still trading above NAV > absolutely expensive
Relative valuation vs history:
- 1-yr avg premium: +24.89%
- 3-yr avg premium: +24.25%
- 5-yr avg premium: +23.28%
> GOF is ~12–13 percentage points cheaper than its own long-term norm
Z-scores:
- 1-yr Z: -1.33
- 3-mo Z: +0.65
- 6-mo Z: -0.68
> Confirms premium compression, not expansion.
PDI
Absolute valuation:
Relative valuation vs history:
- 1-yr avg: +11.65%
- 3-yr avg: +10.12%
- 5-yr avg: +9.36%
> Current premium is 2–3% below historical norms
Z-scores:
- 1-yr Z: -0.87
- 3-mo Z: +1.46
- 6-mo Z: -0.48
> Improving short-term momentum, but still below norm.
PCN - Current premium: +7.49%
- 1-yr avg: +9.42%
- 3-yr avg: +13.50%
- 5-yr avg: +15.54%
> Cheaper vs history, especially longer-term.
DSM Conclusion (Premium Funds)
These funds remain absolutely premium-priced, but are cheap relative to their own historical premium regimes. This week continued orderly premium compression, not overvaluation.
3. Discounted Equity CEFs — Mean Reversion Evidence
ADX
- Current discount: -5.58%
- 1-yr avg: -8.41%
- 3-yr avg: -11.66%
- 5-yr avg: -12.75%
Z-scores:
- 1-yr: +1.83
- 3-mo: +1.07
- 6-mo: +1.64
> Discount narrowing, consistent with mean reversion
BST - Current discount: -5.61%
- 1-yr avg: -5.37%
- 3-yr avg: -2.94%
- 5-yr avg: -1.96%
> Slightly cheaper than long-term norms
> Z-scores improving (3-mo: 0.57, 6-mo: 0.39)
BME - Current discount: -5.32%
- 1-yr avg: -7.37%
- 3-yr avg: -6.24%
- 5-yr avg: -3.23%
Z-scores:
- 1-yr: +2.55
- 3-mo: +1.90
- 6-mo: +2.70
> Strongest valuation recovery signal this week
4. Income-Stability Funds — Structural Premiums
DNP
- Current premium: +7.64%
- 3-yr avg: +11.77%
- 5-yr avg: +12.77%
> Still premium, but below norm
Z-scores:
- 1-yr: +0.80
- 3-mo: -0.54
- 6-mo: +0.37
> Stable, low volatility, no tactical signal
UTG / UTF - UTG current discount: -0.42%
- UTF current discount: -4.56%
Both sit near long-term averages, with Z-scores near zero > valuation neutral
5. Income Durability Overlay (RoC-Aware, Data-Consistent)
High durability / constructive income:
- ADX, BME, BST
> Deep discounts + improving Z-scores + NAV stability
Mixed durability:
- PDI, PCN
> Premium priced, but income backed by NAV and capital gains cycles
Lower durability / distribution-managed:
- GOF, CSQ
> Persistent RoC usage + structural premium model
> No new deterioration detected this week; classifications unchanged.
6. Weekly Change Summary (This Week vs Last)
Improving (discount narrowing):
- ADX (-7.23% > -5.58%)
- BME (-6.01% > -5.32%)
- BST (-5.61% stable, Z-scores rising)
Still compressing (orderly):
- GOF (+12.49%, down from higher teens recently)
- PDI (+8.27%, stable)
Stable / neutral:
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