After a very strong start to the year when the average closed-end fund (CEF) gained 6.42% during the first quarter (https://www.ftportfolios.com/Commentary/Insights/2021/4/22/first-quarter-2021), many CEFs continued the positive momentum in the second quarter with the average CEF rising 7.83%. It was a very broad rally with equity CEFs increasing 10.64%, fixed-income CEFs rising 6.18%, taxable fixed-income CEFs gaining 6.10% and municipal CEFs increasing 6.29%. (Source: Morningstar. All performance is based on share price total return). Equity CEFs benefitted from the 8.55% increase in the S&P 500 Index and the 5.48% rise in the MSCI All-Country World Ex US Index. Fixed-income CEFs benefitted from the strength in several key fixed-income markets. The ICE BofA High-Yield Bond Index gained 2.77% during the second quarter, while the S&P/LSTA Leveraged Loan Index rose 1.47% for the quarter, the ICE BofA Preferreds Index gained 3.06%, while the ICE BofA 7 12 Yr. Municipal Index added 1.35%. (Source: Bloomberg).

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