Liliana Dearth is to be excused if she sometimes feels like a kindred spirit with the late Rodney Dangerfield. Just as the legendary comedian complained about not getting any respect, the Spain Fund
Dearth could claim, with complete truthfulness, that the Spain Fund's total reinvested return was a respectable 13.2% annual rate for the past three years ended Aug. 31. The fund's problem is that an investor could claim, with equal veracity, that the fund's return for the same three-year period was a lackluster 1.5%.
The disparity in returns is a result of the difference between rates of return achieved by the fund in growing its assets and the value the market attaches to the fund. Even though a closed-end fund might be successful in growing its net asset value per share at a benchmark-beating rate, an investor's return is based on the market price of its shares that's determined by the supply-demand interaction of stock market participants.The disparity between the Spain Fund's return based on its NAV and the fund's lagging stock market return left it recently priced at 8.9% below the value of its portfolio holdings. SNF's top holdings include Telefonica SA
Listed nearby are five funds whose three-year market performances lagged their respective annualized total-return NAV advances by at least 7 percentage points.
The quintet of closed-end funds in the table has also been suffering disparities between NAV returns and market results for the most recent 12 months. For example, Michael Tokarsz and his team at the MVC Capital Fund