Closed-End Fund Arbitrage strategies

5 documented Closed-End Fund Arbitrage strategies from our reference catalogue of 20,000 — names, logic and sources. Catalogued here, tested honestly, and — usually — buried in the graveyard.

CEF discount mean reversion

Discount/PremiumLong

Buy CEFs trading at >10% discount; historical mean reversion as discounts narrow

Source: Mutual Fund Lit

CEF open-ending event

Discount/PremiumLong

Buy CEFs likely to convert to open-end (full discount closes to zero overnight)

Source: Activist

CEF rights offering arb

Discount/PremiumNeutral

Trade rights offerings: subscribe at discount sell shares; classic arb

Source: CEF

CEF tender offer arb

Discount/PremiumNeutral

Anticipate activist-induced tender offers when discounts persist; profit on tender premium

Source: Activist

SPAC-like CEF discount

Discount/PremiumLong

Some CEFs liquidate at NAV; buy at deep discount before liquidation announce

Source: Special Sit

An encyclopedia of publicly documented strategies for education. YCAI does not recommend, endorse, or trade any of these. Not investment advice.