Should You Buy the 8 Percent Closed-End Fund a 68-Year-Old Couple Has Held for 12 Years and Most Advisors Will Not Touch?

1 hour ago 1

Drew Wood

Fri, May 22, 2026 astatine 9:16 AM CDT 6 min read

Quick Read

Eaton Vance Tax-Managed Global Diversified Equity Income Fund (EXG) yields 9.1% astatine marketplace terms with a 19% one-year full return, portion Cohen & Steers Quality Income Realty Fund (RQI) yields 9% with monthly distributions of $0.09 positive periodic year-end specials. Both are closed-end funds generating the $16,000 yearly income a retired mates needs, but necessitate purchasing astatine meaningful discounts to NAV to warrant the strategy.
Conservative output strategies astatine 3.5% necessitate $457,000 successful superior to make $16,000 annually but present increasing income implicit 2 decades, portion assertive 8% CEFs similar EXG and RQI present contiguous income connected conscionable $200,000 but hazard staying level successful existent presumption arsenic ostentation erodes purchasing power.
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A retired couple, some 68, has owned the aforesaid closed-end money for 12 years, collecting an 8% output the full time. Their fee-based advisor refuses to urge it. Their taxation preparer groans each outpouring erstwhile the analyzable 1099-DIV arrives. Yet the numbers are hard to ignore. On a $200,000 acquisition made successful 2014 astatine a 12% discount to nett plus value, the money has generated astir $16,000 a twelvemonth successful income, oregon astir $192,000 successful cumulative distributions implicit 12 years, portion the fund’s nett plus worth has remained comparatively stable. That $16,000 yearly income watercourse is the existent benchmark. The question is whether the closed-end money attack is the champion mode to prolong it implicit a agelong retirement, oregon whether a much blimpish output tier yet produces a steadier result implicit 20 years.

The Two Funds successful Question

The couple's holding looks a batch similar Eaton Vance Tax-Managed Global Diversified Equity Income Fund (NYSE:EXG), a planetary equity income CEF that runs a covered-call overlay and presently shows a organisation complaint adjacent 9.1% astatine marketplace terms and 8.3% astatine NAV. Shares commercialized astir $9, with a one-year full instrumentality of 19% and a ten-year summation of 172% connected a split-adjusted basis.

The different classical illustration is Cohen & Steers Quality Income Realty Fund (NYSE:RQI), a leveraged REIT-focused CEF paying $0.09 monthly (recently raised from $0.08) positive periodic year-end specials specified arsenic the $0.13 organisation paid successful aboriginal 2026. RQI presently trades astatine astir $13 with a organisation complaint adjacent 9% and a tiny discount to NAV of astir 1%.

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