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CEF Specialist

The Incredible Shrinking CEF Universe

The number of closed-end funds available has shrunk by nearly one fifth since 2011.

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Closed-end funds are quickly becoming an endangered species.

The number of CEFs has dwindled during the past five years as fund liquidations and mergers have handily outpaced initial public offerings. The universe of available CEFs has fallen to 565 as of June 1, 2015, from almost 700 in 2011. So far this year, there have been two IPOs (the second just last month) and eight liquidations and mergers through the end of May, with more CEFs soon to be disappearing: The board of directors of Alliance NY Municipal Income Fund (AYN) has approved a liquidation plan for the fund, pending shareholder approval, and Nuveen Investments plans to convert two CEFs to exchange-traded funds, pending shareholder and regulatory approval. This year is shaping up to be the fourth-straight year that more closed-end funds depart than are brought to market.

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Jason Kephart does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.