FCT: NAV Destruction Is A Big Problem As This Fund Tries To Sustain Its Distribution

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  Posted by Two Blokes Jun 24 - Filed in Stock - 4 views
  
  First Trust Senior Floating Rate Income Fund II offers an attractive 11.68% yield, but that yield is unsustainable as the fund fails to cover distributions after recent Fed rate cuts. The FCT fund's net asset value is declining, indicating distributions are being paid from capital, not income, and a distribution cut is likely imminent. Peer funds have already cut distributions and suffered share price declines; FCT investors risk both income reduction and capital loss if they buy now.