FTHY: Monthly Distribution From High-Yield Fixed-Income Exposure
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Nick AckermanInvesting GroupFollow5ShareSavePlay(13min)CommentsSummaryFirst Trust High Yield Opportunities 2027 Term Fund offers high-yield fixed-income exposure with a ~5.5% discount and a term structure set to liquidate by Aug. 1, 2027.FTHY's blend of bonds and floating-rate senior loans helps offset leverage costs, while its 10.72% distribution yield is attractive but not fully covered by net investment income.The fund's portfolio is heavily tilted toward below-investment-grade debt, including a meaningful allocation to CCC-rated securities, presenting heightened credit risk.As the liquidation date nears, FTHY's discount provides alpha potential, but risks include possible term extension and exposure to widening high-yield spreads. yalcinsonat1/iStock via Getty Images Written by Nick Ackerman, co-produced by Stanford Chemist First Trust High Yield Opportunities 2027 Term Fund (FTHY) provides investors with high-yield fixed-income exposure through holding a bond and senior loan portfolio. The fund has consistentlyThis article was written byNick Ackerman15.85K FollowersFollowNick Ackerman is a former financial advisor using his experience to provide coverage on closed-end funds and exchange-traded funds. Nick has previously held Series 7 and Series 66 licenses and has been investing personally for over 14 years.He contributes to the investing group CEF/ETF Income Laboratory along with leader Stanford Chemist, and Juan de la Hoz and Dividend Seeker. They help members benefit from income and arbitrage strategies in CEFs and ETFs by providing expert-level research. The service includes: managed portfolios targeting safe 8%+ yields, actionable income and arbitrage recommendations, in-depth analysis of CEFs and ETFs, and a friendly community of over a thousand members looking for the best income ideas. These are geared towards both active and passive investors. The vast majority of their holdings are also monthly-payers, which is great for faster compounding as well as smoothing income streams. Learn More.Analyst’s Disclosure:I/we have a beneficial long position in the shares of DMA, PDX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. May take a long position in FTHY in the next 72 hours.Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.Recommended For You