Only in the world of CEFs will you find the average fund trading at a discount to NAV of 7% or more. A blog I have just discovered, with the great name of “Beating Buffett,” has a fairly recent post on the three closed-end funds managed by Royce.
It’s my opinion that Royce has a great reputation as value investors, and when their CEFs are trading at discounts as steep as 16 or 17%, I would seriously consider putting some money to work in them. For example, the Royce Value Trust (RVT) is trading at a 16.83% discount to NAV. Click the image below for a history of the premium/discount to NAV since inception.
I think its very likely that the discount will once again turn into a premium if you are a patient investor. The possibility of earning 16% on top of the total return of the underlying assets sounds like a great idea to me.
I love that http://www.BeatingBuffett.com website.
Great ideas on stocks and stock options.