Scott Letter: Closed-End Fund Report Interview with Jay Rosenberg of Nuveen Investments: Real Asset Investing (DRA & JRI) [Free Sign-Up Required]
April 10, 2015, Richmond, VA.— Closed-End Fund Advisors is pleased to announce an in-depth interview in The Scott Letter: Closed-End Fund Report with Jay Rosenberg of Nuveen Investments. Jay is lead portfolio manager for both: Nuveen Real Asset Income & Growth (JRI) and Diversified Real Asset Income Fund (DRA).
We found the interview to be a timely update on how investors can gain access to “Real Assets” or as defined by Jay as “contractually reoccurring income on a global basis”. Some highlights include that real assets have historically well outpaced inflation and they seek investments that hit their yield hurdle of 4.5% to 4.75% and that also have the best total return characteristics. They use different parts of the capital structure for their investment to manage both beta in the portfolios as well as interest rate sensitivity.
We also discuss how in real estate, occupancies are up. “It’s definitely a land lords market … [they] typically have pricing power in many parts of the world”. For perspective on the portfolio allocation, the strategy is unique in that they are not just focused on static coupons. Typically fifty percent of the portfolio is in equity securities. As of April 9, 2015, JRI shows a distribution yield of 8.2% and a -2% discount to NAV and DRA shows a distribution yield of 8.7% and a -10% discount to NAV.
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