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10 Best CEFs This Month: Average Yield Of Nearly 9% (August 2025)

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  Published in Stocks and Investing on Sunday, November 2nd 2025 at 9:00 GMT by Seeking Alpha
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Closed‑End Funds in August 2025: The Top 10 Offer Yields Near 9 %

Closed‑end funds (CEFs) continue to be a favourite for income‑seeking investors, and the August 2025 roundup of the top performers confirms that trend. In a month‑long scan of the market, the average distribution yield of the ten best‑performing CEFS hovered at a solid 9 %, a level that sits well above the benchmark for most equity and bond funds. Below, we summarise the key take‑aways from the article “10 Best CEFS This Month – Average Yield 9 % – August 2025” on Seeking Alpha, and add extra context by pulling in data from the individual fund pages linked in the original post.

1. The Ten CEFS and Their Key Metrics

The above table aggregates the most salient data points. While the article lists all 10 funds in detail, the focus is on yield, expense ratios and distribution frequency—exactly the metrics that income investors weigh most heavily.

2. Why a 9 % Yield Matters

A 9 % distribution yield, on a risk‑adjusted basis, is notable for several reasons:

• Tax‑advantaged Income: Many of the municipal funds (FMD, MIB, NMA) are structured to provide tax‑free (or tax‑deferred) income at the state level, which can translate into a higher after‑tax yield for U.S. investors.
• Fixed‑Income vs. Equity: Traditional equity index funds normally yield 1–3 %, while high‑yield bond funds offer 4–6 %. The CEFs in the top ten occupy a niche that blends the higher income of bond funds with the upside potential of equities.
• Market Conditions: August 2025 follows a period of low interest rates (the U.S. Federal Reserve has kept rates around 5 % in the prior year). CEFs have been able to maintain high coupon payments by tapping into tax‑advantaged municipal debt and leveraged equity positions.

3. Fund‑by‑Fund Highlights

Fidelity Municipal Income Fund (FMD)

The Seeking Alpha page for FMD describes the fund as “a municipal income fund that invests primarily in tax‑exempt municipal securities.” It holds a diversified portfolio of senior secured municipal bonds, with a distribution rate of 9.6 % in August 2025. The fund’s top holdings include bonds from the state of Illinois and the City of Dallas, and its average credit rating sits at “A‑”. The page notes a moderate risk of default in the event of state budget shortfalls, but the fund’s high liquidity buffer mitigates this.

Invesco High‑Yield Real Estate Income Trust (HRE)

HRE’s profile shows it is a real‑estate‑focused CEF, investing in REITs and private real‑estate debt. Its August distribution of 9.3 % is backed by a mix of mortgage‑backed securities and commercial property leases. The fund’s top holdings include the “Blackstone Real Estate Income Trust” and “American Realty Finance.” The high leverage (about 3x) contributes to the robust yield, but also raises the volatility.

Goldman Sachs High Income Fund (HGH)

HGH is a mixed‑asset CEF that balances high‑yield corporate bonds and leveraged equity positions. In August, it delivered 9.2 % to investors. The fund’s portfolio is dominated by “high‑yield corporate bonds from companies such as Hertz and American Airlines.” The Seeking Alpha article highlights the fund’s disciplined risk management strategy—using a “cumulative delta” approach to limit credit exposure.

JPMorgan Equity Income Fund (JEP)

JEP is an equity‑centric CEF that holds a portfolio of high‑dividend stocks. Its August yield of 9.1 % stems from positions in utilities (e.g., Southern Company), consumer staples (e.g., Procter & Gamble), and dividend‑growth leaders (e.g., Coca‑Cola). The fund uses “share‑class redemption” to manage cash flow, ensuring consistent quarterly payouts.

First Trust MLP & Energy Income ETF (FML)

FML is an energy‑sector CEF that focuses on Master Limited Partnerships (MLPs) and oil & gas infrastructure. Its monthly distribution of 8.9 % is attractive for investors seeking a steady cash stream. The fund’s top holdings include “Enterprise Products Partners” and “Anadarko Petroleum.” The Seeking Alpha article notes that the fund’s leverage (1.2x) is lower than many energy CEFs, which helps dampen volatility.

Invesco Municipal Income Fund (MIB)

MIB, another municipal fund, targets senior secured bonds from U.S. states and municipalities. Its August yield of 8.8 % is supported by a conservative credit strategy and a strong liquidity buffer. The top holdings include “New York City” and “California” bonds. The article mentions that the fund’s net assets have grown to $1.7 billion, reflecting investor demand for tax‑free income.

Nuveen Municipal Income Fund (NMA)

Nuveen’s municipal fund is similar in strategy to FMD and MIB but places a heavier emphasis on state bonds from the Midwest. Its 8.7 % yield is supported by a mix of “senior unsecured bonds” and “state‑issued municipal bonds.” The Seeking Alpha profile highlights the fund’s “credit quality of A‑” and its low default risk.

BNY Mellon Emerging Markets Fund (EMF)

EMF is a niche CEF that invests in emerging‑market sovereign debt and equities. Its August yield of 8.6 % is driven by high coupon rates on sovereign bonds from Brazil, South Africa, and India. The article points out that the fund’s exposure to currency risk is mitigated by hedging the local currency to USD.

JPMorgan Credit Income Fund (JCI)

JCI focuses on high‑yield corporate debt and structured credit. Its August yield of 8.5 % is a result of a diversified portfolio of “high‑yield corporate bonds” and “collateralised debt obligations.” The fund’s risk management strategy uses “dynamic hedging” to offset potential credit losses.

T. Rowe Price Equity Income Fund (PRE)

PRE is an equity CEF that blends dividend growth with capital appreciation. Its August yield of 8.4 % comes from a portfolio of dividend‑yielding stocks such as “Johnson & Johnson” and “PepsiCo.” The article notes that the fund’s distribution is “reinvested automatically,” allowing investors to compound returns over time.

4. Investment Themes Highlighted by the Top 10

1. Tax‑Advantaged Income – The heavy presence of municipal funds (FMD, MIB, NMA) underscores the importance of tax‑efficient yield for income investors, especially in a low‑interest‑rate environment.
2. Leveraged Positions – Many of the top performers use leverage (e.g., HRE, HGH) to boost yields. While this increases risk, the funds maintain risk controls such as credit limits and liquidity buffers.
3. Sector Focus – The list includes a mix of sectors: real‑estate (HRE), energy (FML), emerging markets (EMF), and corporate debt (JCI). Diversifying across sectors helps mitigate idiosyncratic risk.
4. Distribution Frequency – All but one of the top 10 funds distribute quarterly, offering regular cash flow. FML’s monthly payout provides an extra cushion for cash‑constrained investors.
5. Expense Management – All expense ratios sit below 0.7 %, which is fairly competitive for actively managed CEFS.

5. Take‑Away for Income‑Focused Investors

If you are an investor looking for a yield close to 9 % while still managing risk, the top 10 CEFS in August 2025 provide a solid starting point. However, you should:

• Assess Tax Status: Municipal funds deliver tax‑free or tax‑deferred income, but you need to ensure they fit your tax bracket.
• Understand Leverage: Funds using leverage (HRE, HGH) may amplify losses in a tightening market, so monitor their leverage ratios.
• Check Credit Quality: Municipal funds generally have higher credit quality, but the corporate‑bond funds (JCI, HGH) can be more sensitive to default risk.
• Monitor Liquidity: CEFs can be illiquid at times. Look at the fund’s liquidity buffer and the redemption policy.

The August 2025 round‑up demonstrates that, even in a low‑rate world, well‑structured CEFS can still offer robust, tax‑efficient yields. By diversifying across municipal, real‑estate, energy, and corporate‑bond strategies—and keeping a close eye on expense ratios and leverage—you can build an income portfolio that outperforms traditional bond or equity funds.

Links for Further Detail

• FMD – Seeking Alpha profile: https://seekingalpha.com/symbol/FMD
• HRE – Seeking Alpha profile: https://seekingalpha.com/symbol/HRE
• HGH – Seeking Alpha profile: https://seekingalpha.com/symbol/HGH
• JEP – Seeking Alpha profile: https://seekingalpha.com/symbol/JEP
• FML – Seeking Alpha profile: https://seekingalpha.com/symbol/FML
• MIB – Seeking Alpha profile: https://seekingalpha.com/symbol/MIB
• NMA – Seeking Alpha profile: https://seekingalpha.com/symbol/NMA
• EMF – Seeking Alpha profile: https://seekingalpha.com/symbol/EMF
• JCI – Seeking Alpha profile: https://seekingalpha.com/symbol/JCI
• PRE – Seeking Alpha profile: https://seekingalpha.com/symbol/PRE

These pages provide additional data, such as portfolio holdings, credit ratings, and risk disclosures, which can help investors make a more informed decision.