NZF: Aggressive Leverage Limits Appeal
The Nuveen Municipal Credit Income Fund (NZF) provides a 7.7% tax-exempt yield, appealing primarily to income-focused investors. However, the fund faces challenges due to high leverage and net asset value (NAV) erosion. Future performance may hinge on declining interest rates to improve share price appreciation.
- ▪NZF offers a 7.7% federally tax-exempt yield for income investors.
- ▪The fund has a high leverage ratio of 40.62% of assets.
- ▪Persistent NAV erosion is attributed to distributions exceeding earnings.
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