Latest news with #GuggenheimStrategicOpportunitiesFund
Yahoo
01-08-2025
- Business
- Yahoo
Guggenheim Investments Announces August 2025 Closed-End Fund Distributions
NEW YORK, Aug. 01, 2025 (GLOBE NEWSWIRE) -- Guggenheim Investments today announced that certain closed-end funds have declared their distributions. The table below summarizes the distribution schedule for each closed-end fund (collectively, the 'Funds' and each, a 'Fund'). The following dates apply to the distributions: Record Date August 15, 2025 Ex-Dividend Date August 15, 2025 Payable Date August 29, 2025 Distribution Schedule NYSE Ticker Closed-End Fund Name Distribution Per Share Change from Previous Distribution Frequency AVK Advent Convertible and Income Fund $0.1172† Monthly GBAB Guggenheim Taxable Municipal Bond & Investment Grade Debt Trust $0.12573† Monthly GOF Guggenheim Strategic Opportunities Fund $0.1821† Monthly GUG Guggenheim Active Allocation Fund $0.11875† Monthly † A portion of this distribution is estimated to be a return of capital rather than income. Final determination of the character of distributions will be made at year-end. The Section 19(a) notice referenced below provides more information and can be found at You should not draw any conclusions about the Fund's investment performance from the amount of this distribution or from the terms of the Fund's Distribution Policy. Past performance is not indicative of future performance. As of this announcement, the sources of each fund distribution are estimates. Distributions may be paid from sources of income other than ordinary income, such as short-term capital gains, long-term capital gains or return of capital. Unless otherwise noted, the distributions above are not anticipated to include a return of capital. If a distribution consists of something other than ordinary income, a Section 19(a) notice detailing the anticipated source(s) of the distribution will be made available. The Section 19(a) notice will be posted to a Fund's website and to the Depository Trust & Clearing Corporation so that brokers can distribute such notices to Shareholders of the Fund. Section 19(a) notices are provided for informational purposes only and not for tax reporting purposes. The final determination of the source and tax characteristics of all distributions will be made after the end of the year. This information is not legal or tax advice. Consult a professional regarding your specific legal or tax matters. About Guggenheim Investments Guggenheim Investments is the global asset management and investment advisory division of Guggenheim Partners, LLC ('Guggenheim'), with more than $253 billion* in assets under management across fixed income, equity, and alternative strategies. We focus on the return and risk needs of insurance companies, corporate and public pension funds, sovereign wealth funds, endowments and foundations, consultants, wealth managers, and high-net-worth investors. Our 220+ investment professionals perform rigorous research to understand market trends and identify undervalued opportunities in areas that are often complex and underfollowed. This approach to investment management has enabled us to deliver innovative strategies providing diversification opportunities and attractive long-term results. Guggenheim Investments includes Guggenheim Funds Investment Advisors, LLC ('GFIA'), Guggenheim Partners Investment Management, LLC ('GPIM') and Guggenheim Funds Distributors, LLC ('GFD'). GFIA serves as Investment Adviser for GBAB, GOF and GUG. GPIM serves as Investment Sub-Adviser for GBAB, GOF and GUG. GFD serves as servicing agent for AVK. The Investment Adviser for AVK is Advent Capital Management, LLC and is not affiliated with Guggenheim. *Assets under management are as of 6.30.2025 and include leverage of $14.8bn. Guggenheim Investments represents the following affiliated investment management businesses of Guggenheim Partners, LLC: Guggenheim Partners Investment Management, LLC, Security Investors, LLC, Guggenheim Funds Distributors, LLC, Guggenheim Funds Investment Advisors, LLC, Guggenheim Corporate Funding, LLC, Guggenheim Wealth Solutions, LLC, Guggenheim Partners Europe Limited, Guggenheim Partners Japan Limited, GS GAMMA Advisors, LLC, and Guggenheim Private Investments, LLC. This information does not represent an offer to sell securities of the Funds and it is not soliciting an offer to buy securities of the Funds. There can be no assurance that the Funds will achieve their investment objectives. Investments in the Funds involve operating expenses and fees. The net asset value of the Funds will fluctuate with the value of the underlying securities. It is important to note that closed-end funds trade on their market value, not net asset value, and closed-end funds often trade at a discount to their net asset value. Past performance is not indicative of future performance. An investment in closed-end funds is subject to investment risk, including the possible loss of the entire amount that you invest. Some general risks and considerations associated with investing in a closed-end fund may include: Investment and Market Risk; Lower Grade Securities Risk; Equity Securities Risk; Foreign Securities Risk; Interest Rate Risk; Illiquidity Risk; Derivative Risk; Management Risk; Anti-Takeover Provisions; Market Disruption Risk and Leverage Risk. See for a detailed discussion of Fund-specific risks. Investors should consider the investment objectives and policies, risk considerations, charges and expenses of any investment before they invest. For this and more information, visit or contact a securities representative or Guggenheim Funds Distributors, LLC 227 West Monroe Street, Chicago, IL 60606, 800-345-7999. Analyst InquiriesWilliam T. Korvercefs@ Not FDIC-Insured | Not Bank-Guaranteed | May Lose ValueMember FINRA/SIPC (08/25) 65663
Yahoo
12-06-2025
- Business
- Yahoo
3 Dividend Stocks With High but Shaky Yields That Are Probably Going to Get Cut
This closed-end fund's net asset value continues to decline, making its distribution appear increasingly untenable. Whirlpool faces significant near-term pressure, and a dividend cut would help ease that. UPS' free cash flow may not cover its dividend in 2025, and there are more effective uses for its cash flow, such as investing in its growth initiatives. 10 stocks we like better than United Parcel Service › With respective dividend or distribution yields of 14.7%, 8.3%, and 6.6%, these three investments could provide an investor with an aggregate yield of 9.9% if purchased together. However, I think that the closed-end Guggenheim Strategic Opportunities Fund (NYSE: GOF), the home appliance company Whirlpool (NYSE: WHR), and UPS (NYSE: UPS) are likely to reduce their dividends or distributions to investors. Furthermore, in two of the cases, doing so would make them stronger companies. Here's why. This is a closed-end fund, meaning it doesn't raise new capital from investors; but it can use debt to generate returns for them. It trades on the market like a stock, and it makes monthly distributions (rather like dividends). The fund has a superb record of making distributions to investors, having maintained them for over a decade. But here's the thing: The fund's net investment income hasn't covered its distribution for the last seven years, and over the previous six years, the fund has used its capital to make distributions. This is to the detriment of its net asset value (NAV), which has declined every year since 2018, and now stands at $11.50. Meanwhile, the fund has effectively increased its leverage to boost its investment income. This isn't a sustainable path, yet the market is pricing it at a 28.5% premium to its NAV. Go figure. The home appliance company is one of the most interesting stocks on the market. Management believes it will benefit from the Trump tariffs and the administration's approach to defending American manufacturing interests, not least by closing a loophole that allows Asian competitors to use Chinese steel in their products and thereby avoid tariffs on it. That may be the case, and it is good news for Whirlpool and its competitive positioning. Still, the company must navigate ongoing weakness in the housing market, which is unlikely to improve until mortgage rates decrease from their relatively high level. High rates discourage home sales, which hurt the higher-margin discretionary appliance sales that Whirlpool needs to boost its earnings. d And the recent easing of the trade conflict may encourage competitors to increase imports to the U.S. as they did in the fourth quarter of 2024 and the first quarter of 2025, ahead of any tariffs imposed by the new regime. It all adds up to an uncertain near-term environment for Whirlpool, and its earnings and cash flow guidance could be under threat. The annual dividend currently uses up $390 million in cash, and management expects $500 million to $600 million in free cash flow (FCF) in 2025. However, it has $1.85 billion in debt maturing in 2025 and plans to pay down $700 million of it through refinancing, with the amount ranging from $1.1 billion to $1.2 billion. Those plans could come under threat if the company misses guidance, and I think that could happen in the current environment. Alongside Whirlpool, UPS will be a better investment if and when it cuts its dividend. The company began the year with management estimating that it would generate $5.7 billion in FCF while paying $5.5 billion in dividends and expecting to make $1 billion in share buybacks. Then, in late April, the impact of tariffs on the economy began to take effect. And management declined to affirm its full-year guidance on the first-quarter earnings call, implying that its FCF guidance is under threat. Furthermore, there's the added complication of UPS deliberately reducing its lower-margin delivery volumes by 50% from 2024 to the second half of 2026. The company's dividend is under threat, and even if management elects to maintain it, there's a powerful argument to say it shouldn't. As previously discussed, the company's investments in technology and refocusing its network on higher-margin and more productive deliveries (such as in the healthcare and small and medium-size business markets) imply that its return on equity (RoE) will improve. That would be a significant plus. Still, it would be an even bigger plus if management could allocate more of its earnings to invest in the business at a higher rate of RoE, rather than using up a significant portion of its cash flow and earnings on dividend payments. A dividend cut would help free up cash for productive investment that would add value for shareholders. Before you buy stock in United Parcel Service, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and United Parcel Service wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $657,871!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $875,479!* Now, it's worth noting Stock Advisor's total average return is 998% — a market-crushing outperformance compared to 174% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Lee Samaha has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and United Parcel Service. The Motley Fool recommends Whirlpool. The Motley Fool has a disclosure policy. 3 Dividend Stocks With High but Shaky Yields That Are Probably Going to Get Cut was originally published by The Motley Fool
Yahoo
07-04-2025
- Business
- Yahoo
This 17.9%-Yielding Fund Has Maintained Its Payment for Over a Decade. Can That Streak Continue in 2025?
The 17.9% yield of the Guggenheim Strategic Opportunities Fund (NYSE: GOF) is enticing, and as you will see shortly, this fund has an excellent record of distributions to investors. Still, the key questions are: Is it sustainable? Here's the lowdown. It's a closed-end fund, so it doesn't raise new capital from investors. Like many other closed-end funds, it uses debt and leverage to generate higher returns. Digging into the fund's prospectus, strategy, and holdings, it says it aims to "maximize total return through a combination of current income and capital appreciation" by "investing in a wide range of fixed income and other debt and senior equity securities." It's primarily a fixed-income fund with 92.3% of assets currently in fixed-income investments and the rest in equities, with a tiny amount in derivatives. The fund has about 39.5% in investment-grade debt, meaning it's rated BBB or higher, with the rest below-investment grade. So far, so good. You won't get outsize returns by only investing in investment-grade debt. Moreover, investing in fixed income and equities is a common strategy, and there's nothing wrong with using leverage to generate returns for a closed-end fund. However, four red flags about this fund make it worth avoiding. The distribution is being funded by returning capital rather than investment income or even capital gains on assets. The following chart illustrates this point very clearly. The current annual distribution is equivalent to $2.19, and since 2019, the fund has been returning capital (yellow column) to pay it. Also, from 2019 to 2024, the distribution percentage coming from net investment income ranged from 51% to a low of 35% in 2023. Eagle-eyed readers will note that net investment income did cover the $1.09 per share in distribution in the first half of 2025 -- a point I'll return to later. For now, note that the fund returned capital to sustain the dividend for the five years through 2023. One issue with returning capital is that it's to the detriment of net assets. Indeed, the fund's net asset value (NAV) has declined since 2018, and the last reported NAV was $11.47 per share. The shares now trade at about $14, a premium of almost 20% to NAV -- and the premium was much higher before the recent market retreat. Anyone buying the fund at this price is paying a hefty premium on the assumption that the fund will sustain its distribution. That's much harder to do when capital is used to pay distributions. Management discussed leverage in its reporting, saying in its semiannual report in November, "One purpose of leverage is to fund the purchase of additional securities that may provide increased income and potentially greater appreciation." One way it's doing this is through reverse repurchase agreements. These involve the fund transferring an asset to a counterparty for cash and an agreement to repurchase the asset at a higher price. As noted above, it's effectively borrowing and taking on leverage to generate higher returns. It's something the fund is using more often, and that adds risk. Going back to the first chart above, in the six months ended Nov. 30, the fund did generate the net investment income to just about cover the distribution. In addition, the fund's NAV rose 9.5% during the six months on a total return basis. That's good news, but consider that it was an extremely favorable period for the fund, which is unlikely to repeat. Discussing the strong performance in its semiannual report, management said, "The yield curve bull steepened, meaning yields at the short end of the curve fell more than the long end, with yields on 2-year and 10-year Treasuries finishing 72 basis points and 33 basis points lower, respectively." I'll translate by explaining the following charts. In the six months ended Nov. 30, the two-year yield dropped more than the 10-year as the market priced in near-term interest rate cuts, so the price of short-term bonds increased more than long-term bonds. That was good for the fund. However, while that trend has held since Nov. 30, it's not a move of the same magnitude. As such, the fund's NAV declined from $11.94 at the end of November to $11.47 at present, so you can look at the fact that its first-half 2025 investment income covered its distribution as a result of very favorable market conditions that are unlikely to hold up. Increasing leverage, paying distributions out of capital, NAV that's sliding, and relying on favorable market conditions to barely cover distributions with net investment income is not a recipe for a high probability of sustaining a distribution. Consequently, most risk-averse investors will want to give this fund a pass since there's a significant risk the distribution will be cut in the future. Before you buy stock in Guggenheim Strategic Opportunities Fund, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Guggenheim Strategic Opportunities Fund wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $461,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $578,035!* Now, it's worth noting Stock Advisor's total average return is 730% — a market-crushing outperformance compared to 147% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of April 5, 2025 Lee Samaha has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This 17.9%-Yielding Fund Has Maintained Its Payment for Over a Decade. Can That Streak Continue in 2025? was originally published by The Motley Fool
