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Michael Z's avatar

Hi Paul, Happy New Year! For your amusement, having taken a bunch of profits on some tech stocks like PLTR, PANW, MRVL, and AAPL, I decided (with my cowboy hat firmly on) to dip my toe into some CEFs and BDCs. My method was backwards--to try some that were recommended on SA and then learn more about them. You will agree with the part of my method, I think, in that they are so risky that I limited myself to between 1/2 and 1 percent of my portfolio...the total invested is perhaps 6% of my total. NLY I stayed away from, even I could see that was too risky. One I came across that actually seems decent is FDUS, with a decent dividend coverage and relatively low leverage. Some SA authors seem to think that earning 16% in dividends and having share value decline by 8%, annually, is a good way to proceed. For that net return, I can just buy more PFFA and RIET and enjoy 10% return without worrying too much (not go fishing, no). For comparison, the latter two mentioned are 14% of my personal portfolio, and most of my gains from the tech sales are in other techs or tamer income generators. I'll keep you posted on how the risky assets do. Overall, my portfolio is approximately 40% large cap tech, 40% income generation, and 20% non-tech/foreign.

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