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Strategies & Market Trends : Young and Older Folk Portfolio -- Ignore unavailable to you. Want to Upgrade?

To: Smart_Asset who wrote (20990)	10/6/2025 1:35:43 PM
From: macbolan	2 Recommendations Recommended By bugdoc82 Smart_Asset Read Replies (2) \| Respond to of 23079

RE: I have NAC and MUC in a taxable account I also have MUC, NAC, NKX, and VCV in a taxable account. Same account that's holding a few individual CA GOs. One is getting called next month so I'm considering splitting the proceeds from that to these 4 CA Muni bond CEFs rather than going out and rebuying another individual CA GO. Anyone see any downside other thant the fluctuation of price in buying the CEFs vs the individual GO? I figure if I go with the CEFs I get more yield (more risk too cause some use Leverage), more liquidity that selling an individual bond. More flexibility as I don't have to sell like 25k of a bond if I need it I can just liquidate a portion of a Muni CEF. Plus I don't have to worry about the calling anymore, I let the CEF managers worry all about that. I have heard some say that not all of the distribution is non tax because some could be ROC or something like that. I'm thinking for all the flexibility I get and the increased yield, plus they pay monthly, I should just go with the 4 CEFs instead of getting another individual bond. Thoughts?

To: Smart_Asset who wrote (20990)	10/6/2025 4:21:39 PM
From: Rincon v2.0	1 Recommendation Recommended By Smart_Asset Read Replies (1) \| Respond to of 23079

Re: Looks like both are very stable but I could be missing something.. Muni bond CEFs are not at all stable. They are highly sensitive to interest rate changes. Not only that, they are leveraged which means the cost of leverage itself is also sensitive to interest rates. A double whammy. So share price can drop as NAV declines, then you get hit with distribution cuts as the cost of leverage increases with rising interest. These are rollercoasters. The perfect time to buy was earlier this year, before the Fed cut interest rates. However, as you can see from any chart, prices are still depressed. When interest rates are cut further, NAV and share price will rise, leverage costs will drop, and distributions can rise. That’s why I added to CEV, PCQ, and MUC last month.