Reaves Utility Income Fund

W.H. Reaves & Company, Inc. (dba Reaves Asset Management) - Investment Management An investment advisor specializing in utilities and energy infrastructure, founded in 1961 Approximately $2.7 billion in total assets under management (as of 09/30/2016) 37-year track record for institutional clients Portfolio managers are supported by a highly experienced management team Research team averages over 20 years of industry experience Philosophy Reaves Asset Management believes that an information advantage can be created when experience analysts focus their fundamental, quantitative and qualitative, bottom-up research within the utility sector. Furthermore, the identification of utility companies that are disciplined enough to supply growing dividend income to their shareholders is a key component in the management process.

The utility sector has continued to face pressure with a higher rate environment still, but there has been a bit more promise lately with the sector rising. Reaves Utility Income Trust is a solid closed-end fund in the utility space with a history of raising distributions. UTG's distribution yield is currently at 8.32%, which I believe is attractive and sustainable.

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UTG is starting to perk up, having had a rough couple of years as interest rates rose. Higher interest rates are likely to be included in utility rate bases going forward. Better yet, industry experts are pointing to the huge impact AI will have on demand for electrical power.

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Closed-end funds, or CEFs, offer numerous advantages for income-focused investors. However, they face a significantly heightened risk level due to recent events. We discuss these risks and suggest alternatives that investors can pursue to protect their passive income streams.

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Leading billionaire investors are pouring billions of dollars into the infrastructure sector. There are many other tailwinds for the sector. We compare UTG and UTF to see which is the better buy today.

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Closed-end funds tend to cut their payouts over time due to negative consequences of leverage during market crashes, leading to potential permanent capital destruction. Today, we are looking to revisit the six funds that have inceptions prior to the 2008/09 Global Financial Crisis that have still never cut their regular distributions. A long history of no-cuts can be important for income-focused investors, but we also examine coverage and valuations to determine whether they are worth exploring further.

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Utilities sector has led all others in the past month and quarter, rising 9.78% and 17.33%, respectively. Reaves Utility Income Trust is a closed-end fund with significant exposure to utilities and a strong long-term track record. The UTG CEF pays monthly dividends with a yield of 8.21% and has a positive 5-year dividend growth rate.

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The utilities sector has underperformed the market due to rising interest rates, but high dividend income can offset underperformance. Reaves Utility Income Trust (UTG) sits at a slight discount to NAV. In addition, the fund's tax advantaged distribution makes it attractive for income investors. UTG's fund strategy focuses on dividend-paying stocks in the utilities sector, with a diverse breakdown of holdings.

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Interest rate changes are part of the economic cycle; we choose to get paid handsomely through the drama. Certain sectors benefit big from rate cuts, and pay rich income through the waiting process. We discuss two quality CEFs offering +7% yields to enrich our retirement income.

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Reaves Utility Income Trust has outperformed Cohen & Steers Infrastructure Fund since our last article. The alpha capturing opportunity has been realized quicker than anticipated, with a 12.43% alpha captured in less than 4 months. We tell you why it is a great time to exit UTF.

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There are many compelling benefits to investing in dividend ETFs and CEFs. However, there are several key differences between investing in dividend ETFs and CEFs and buying individual dividend stocks that I wish I had known before investing. We discuss why we favor investing in individual dividend stocks over buying dividend ETFs and CEFs and also share the best kinds of stocks for implementing our strategy.

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Investing in high-yield, low-risk dividend stocks can generate dependable passive income while preserving and even growing principal over time. We discuss the non-negotiable bedrock principles for success in high-yield investing. We also share numerous high-yielding, low-risk dividend stocks and funds that we think fit in well with this approach.

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Monthly dividends are popular for income investors, providing regular cash flow and easier budgeting. Investing in monthly paying high-yielding closed-end funds offers diversification, leverage, and professional management. We detail four CEFs that offer attractive monthly dividends and meaningful upside potential in April 2024.

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Leveraged income funds like Reaves Utility Income Trust have been negatively impacted by inflation and rising rates. UTG has consistently struggled over the last three years, offering investors minimal returns compared to peers. The utility industry outlook remains poor, and the fund's reliance on long-term capital gains and high leverage costs hinder its ability to provide substantial income or returns.

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US consumer spending increased by 0.8% MoM in February, the largest gain since January 2023.

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Reaves Utility Income Trust is a stable income investment that focuses on the regulated utility industry. UTG shares have remained relatively flat but have acted as a proxy for fixed-income investments due to their distributed income. I believe that UTG will benefit from a lower rate environment and I am bullish on its potential for income investors.

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Reaves Utility Income offers a nearly 9% yield and leveraged exposure to three major tailwinds in the infrastructure sector.

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The Near Perfect Portfolio Strategy provides SWAN-like attributes and aims to meet income and growth goals while minimizing volatility and drawdowns. The strategy consists of three buckets: Dividend Growth Investing, High Income (CEF investing), and Hedging (Rotational bucket). Backtesting results over 17 years show that the strategy has the potential to outperform the S&P 500, with lower drawdowns and volatility.

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Steve Eisman says the market is operating with unrealistic expectations from the Federal Reserve and expects far fewer rate cuts in 2024. The Big Short investor maintains bullishness over established companies benefitting from historic federal spending. We discuss two time-tested, monthly-pay CEFs from Mr. Eisman's top sectors.

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Reaves Utility Income Trust is a high-yielding closed-end fund focused on utilities. The fund has returned over 10% since my recommendation in October. However, the trade is a rebound trade that is mostly played out, and I am downgrading UTG to a hold. Warren Buffett's recent annual letter raises concerns toward utility sector investments that readers should pay heed to.

News for Reaves Utility Income Fund ETF (UTG)