The NAVigator

Axel Merk, President and Chief Investment Officer at Merk Investments , discusses Saba Capital's activist campaign that got him ousted as portfolio manager and president of ASA Gold and Precious Metals Ltd. , a closed-end fund that was up nearly 200% last year but that still was branded with the label of being a "poor performer." Merk, who took over the closed end fund in 2016 and helped to nearly...

Kevin Dreyer, Co-Chief Investment Officer for value at Gabelli Asset Management , says that there are plenty of values left in a market that has returned to record levels, particularly when valuing stocks based on "what an informed industrialist or buyer would pay to buy the whole business." Dreyer, part of the team running Gabelli Equity Trust and some of the firm's other closed-end funds, says t...

John Cole Scott, President of CEF Advisors , attended the Private Credit Summit hosted this week in New York City by Dechert LLP, and came away with a sense that private-credit markets have not yet gotten to the overheated levels that could turn investor fears of a blow-up into a financial reality. Scott, also the chairman of the Active Investment Company Alliance , discusses "stress tests" that F...

Ken Burdon, Partner in the registered fund practice at Simpson Thacher & Bartlett , discusses the Supreme Court's recent ruling against activist investor Saba Capital , a decision that could have a chilling effect on shareholder activism in the future. Burdon says the decision removes a key path based on the Investment Company Act of 1940 that activists took in pursuing cases over fund fees and st...

John Cole Scott, President of CEF Advisors , says that index discounts are wide when compared to their three-year history, which makes it important for investors to find names where wide discounts are supported by improving fundamentals. Scott, who also is chairman of the Active Investment Company Alliance , says that both the national muni CEF index and the taxable bond CEF index have seen wider...

Steve Baffico, Executive Vice President and head of listed products at Bluerock , which runs the Bluerock Private Real Estate fund, expects the real estate market to benefit as money moves from private credit , business-development companies and direct-lending strategies in pursuit of something with "hard assets and low obsolescence." That HALO trade should drive growth moving forward; Baffico dis...

Gordon Hamilton, Senior Managing Director for Kayne Anderson , Portfolio Manager for the Kayne Anderson Energy Infrastructure fund, says that there will be a big call on U.S. energy infrastructure companies to meet global demand for propane, butane, crude oil and natural gas as the world gets through the current energy crisis created by war in Iran. Coupled with an energy "supercycle" driven by ar...

Bryce Doty, Senior Portfolio Manager at Sit Investment Associates , says that "the worst is over as far as yields going up," noting that the next shift could be down, but he calls the conditions "tricky" and emphasizes that investors "need to be in the right part of the curve." Doty's case hinges on oil prices;  if oil stays below $110, it's viewed as inflationary, but above that level "we have a...

John Cole Scott, President of CEF Advisors and the Chairman of the Active Investment Company Alliance , looks at the recent issues in business-development companies, which got hammered in March as the market punished software investments, including lenders who made loans to software firms. While BDCs rebounded in April, they remain significantly down, and Scott discusses how the companies with the...

Matt Freund, Co-Chief Investment Officer at Calamos Investments, says that productivity, GDP growth and earnings are "what matters," and that the headline risks that are driving consumer sentiment are "distractions" from a market backdrop that is solid. He says inflation remains the big risk, but notes that the investor sentiment is creating opportunities, particularly in closed-end funds, and esp...

Dr. Mark Mobius, widely considered the father of emerging markets investor and a man who helped put the world into everyone's grasp during his long career running funds at Templeton, passed away in mid-April. John Cole Scott, President of CEF Advisors , recounts Mobius' legacy and lasting lessons by digging into interviews conducted by his father, George Cole Scott, Founder of the Closed-End Fund...

David Gutierrez, Vice President at Liberty Street Advisors and part of the team running the  Private Shares Fund , says that private markets are similar enough to public markets that artificial intelligence is now one of the big sweet spots in both. However, he says the best opportunities involve infrastructure more than AI itself.  Gutierrez notes that t he Private Shares Fund — an actively manag...

Rob Shaker, Portfolio Manager at Shaker Financial Services, says that while the headlines may have investors on edge, the fear-based selling that gripped the market around the start of war in Iran created a "generic widening" of discounts for closed-end funds. Shaker, who is a "discount-capture investor," says the current widening and recovery was caused mostly by "the irrational effects of excess...

With the market kicking business-development companies in the teeth, John Cole Scott , President of CEF Advisors , digs into his firm's data looking at "artificial-intelligence risk scoring" to find BDCs that have been hurt by headlines without holding tainted portfolios. BDCs relied heavily on software companies, due to the tech sector's blend of strong fundamentals, innovation and ability to res...

Matt Weyandt, a client Portfolio Manager on the listed real assets team at Nuveen , discusses how buying "location-specific hard assets" in essential industries that deliver to a "Halo theme" — heavy asset, low obsolescence — creates a buffer against a market that is being driven by headlines and geopolitical risks. Weyandt says that real estate, infrastructure, utilities, midstream energy compani...

Kim Flynn, president at XA Investments , a firm that specializes in alternative investments, says recent private-credit bad news events have widened discounts and raised concerns over business-development companies and interval funds, but have likely created a buy-the-dip moment in the industry. She discusses how fund sponsors and advisers must do a better job educating investors on how these prod...

John Cole Scott, President of CEF Advisors , says that closed-end funds are being buffeted in two directions due to current headlines, with war in Iran impacting net asset values and anchored interest rates impacting levered closed-end funds and discounts shifting to reflect both situations. Scott, who also serves as the Chairman of the Active Investment Company Alliance , says sectors that have b...

Robert Gilhooly, Senior Emerging Markets Economist at Aberdeen Investments , says that the continuing war in Iran has put pressure on oil prices, but he expects them to stabilize short-term while the market determines what happens next. If the outlook becomes one where the Straits of Hormuz are closed off to shipments for a longer stretch of time, he says "If things get really bad, you could be ta...

Ryan MacDonald, Portfolio Manager for the Bluerock Private Real Estate Fund , says that in a world teeming with market worries and broad geopolitical concerns, private real estate is "uniquely boring, in a good way." He says the market has taken its pain over the last three years through interest rate changes and the market cycle, but now values have receded creating a solid entry point. MacDonald...

The stock market has been beating up business-development companies, with the sell-off largely being blamed on the artificial intelligence boom and the high number of loans that BDCs make to software firms. Behind the theory that software companies will struggle to pay debts as artificial intelligence renders their products less useful and attractive, there are real loans, and John Cole Scott, Pre...

Robinhood Markets is launching its first closed-end fund, Robinhood Ventures Fund I, with the first IPO the closed-end fund space has seen in about four years and John Cole Scott, President of CEF Advisors , sizes up the prospects for the new issue, which intends to be a concentrated portfolio of private companies. Scott, the chairman of the Active Investment Company Alliance , discusses the role...

Chris Oberbeck , chairman and chief executive officer at Saratoga Investment Corp. , says that  increases in default rates are more of a return to normal than a sign of trouble for business-development companies or the economy. While stories like the First Brands bankruptcy and fraud case have market watchers looking for more trouble, the rest of the headlines in the industry are much more routine...

Kyle Brown, Chief Executive Officer at Trinity Capital , gives his outlook for the private credit and lending space, and notes that there could be some challenges for business development companies and private lenders late in the current economic cycle because returns from private credit generally have been declining. That has meant single-digit leveraged returns, Brown says, so "Investors are not...

Nick Robinson, Deputy Head of Global Emerging Market Equities at Aberdeen Investments , says that the artificial intelligence wave that has pushed domestic stock markets to record highs is readily apparent around the world — including in countries that are not necessarily synonymous with technology — and that the capital expenditure wave should continue to power foreign markets if companies can mo...

John Cole Scott, President of CEF Advisors , reviews the key takeaways from his firm's fourth-quarter review of action in the closed-end fund industry, focusing on fund consolidation trends that have occurred in the middle of booming asset growth for the industry, as well as discount levels and whether narrowing discounts set up 2026 for more muted results. Scott, the chairman of the Active Invest...