In looking for ways to increase my easy passive income beyond dividend stocks, I’ve recently come across the world of closed-end funds (CEF’s). CEFs are part mutual fund and part ETF but for passive income dividend seekers like myself, they offer an interesting alternative to add to your portfolio.
I recently purchased some shares in the PowerShares CEF Income Composite Portfolio (PCEF) fund which currently yields 6.25%. PCEF is interesting because it is a fund of funds (made up of other income focused CEFs). For people like me dipping a toe into the CEF world, I think it’s a good choice. Note that since the dividends are taxed as ordinary income, I purchased the shares in my tax advantage IRA account.
Are you invested in CEF’s? Please let me know in the comments below!