The first two months of 2011 have looked much like 2010 in the closed-end fund uniberse, with almost all asset classes going up. Continued broad-based positive performance in closed-end funds occurred despite Middle East turmoil and ongoing mixed economic results in the United States and most developed economies.
Sector Round Up: The RiverNorth Closed-End Fund Index’s best performing asset class in February was Convertible Bonds, returning 7.23%, driven by 3.7% discount narrowing. Non-U.S. Equity closed-end funds returned -0.99% for the month, which is represented completely by emerging market closed-end funds and was the only asset class with negative returns.
As discussed in January’s article, investment grade bond closed-end funds have performed very well. Represented by two PIMCO funds, investment grade bonds in the RiverNorth Closed-End Fund index returned 6.21% in February, with year-to-date performance of 17.16%. However, the performance of all investment grade closed-end funds on average is only 3.83% year-to-date.