The portfolio

New portfolio in place from 22 April 2025

The portfolio was fully realigned to the new strategy by 22 April 2025, with no cost to ongoing shareholders due to the manager’s contribution to expenses and the NAV uplift from the tender offer. Previously, almost 10% of BRAI’s portfolio was in non-US stocks, but it is now entirely invested in US stocks.

Marked shifts in sector and stock exposures

Figure 5 shows the portfolio breakdown by industry sector as at 30 September 2025, compared to the end of the last financial year (31 October 2024). There have been significant changes, with much higher exposure to financials and industrials, and lower exposure to healthcare and information technology. The net effect is that, on a sector basis, the portfolio now closely matches the benchmark, so most of the added value comes from choosing the right stocks.

Figure 5: BRAI asset allocation by sector as at 30 September 2025 (and as at 31 October 2024)

Source: BRAI

There is very little overlap between BRAI’s 10 largest holdings at the end of its last financial year (31 October 2024), before the new investment approach, and the top positions in the portfolio at the end of September 2025.

Figure 6: Top 10 holdings as at 30 September 2025

		% as at 30/09/25	% as at 31/10/24	Change
JPMorgan Chase	Financials	3.2	–	3.2
Berkshire Hathaway	Financials	2.8	–	2.8
Walmart	Consumer staples	2.6	–	2.6
Amazon	Consumer discretionary	2.6	1.7	0.9
Bank of America	Financials	2.3	–	2.3
Alphabet	Communication services	1.9	–	1.9
Morgan Stanley	Financials	1.9	–	1.9
Johnson & Johnson	Health Care	1.8	–	1.8
Charles Schwab	Financials	1.7	–	1.7
Pfizer	Health Care	1.6	–	1.6
Total		22.3

Source: BRAI

Performance

Building a track record of outperformance

As mentioned earlier, we do not consider BRAI’s returns before the strategy change relevant here. Figure 7 shows BRAI’s share price and NAV performance compared to its benchmark and the S&P 500 Index.

The data indicate that BRAI has made a strong start, regularly outperforming its objective. The S&P 500’s gains have been driven by a few large AI-related companies, while BRAI’s benchmark is more diversified. Notably, BRAI has delivered solid returns over the past six months without heavily relying on the mega-cap AI trend.

It is still too soon to assess the volatility of these returns, but we will cover this in future reports.

Figure 7: Total return performance data for periods to end October 2025

Calendar year	1 month (%)	3 months (%)	6 months (%)	Since 22 April 2025 (%)
BRAI share price	2.3	8.6	17.7	16.6
BRAI NAV	3.6	8.1	17.2	21.4
Russell 1000 Value	2.9	5.9	15.1	18.5
S&P 500	4.9	9.0	25.6	32.3

Source: Bloomberg

Dividends

New enhanced dividend policy roughly 6% of NAV each year

From 17 April 2025, BRAI began paying a quarterly dividend equal to 1.5% of its NAV, or about 6% per year. The chart’s x-axis shows past ex-dividend dates, and future payments are planned for April, July, October, and January.

Figure 8 highlights BRAI’s dividend history over five years, with the final column showing the impact of the higher dividend policy.

To support these higher dividends and potential share buybacks, BRAI had £105.7m in distributable reserves at the end of April 2025. Paying dividends above net revenue is not new for BRAI, as its dividends have not been covered by earnings since FY 2017. This approach allows BRAI to invest flexibly across the US market, aiming to maximise total returns without needing to focus on high-yielding stocks.

Figure 8: BRAI five-year dividend history for financial years ending in October

Source: BRAI, Marten & Co

Premium/(discount)

Over the 12 months to 31 October 2025, BRAI’s shares traded at a discount to NAV ranging from 11.9% to 1.0%, averaging 6.3%. As of 26 November 2025, the discount stood at 5.4%.

The discount increased during 2023 as markets were led by the Magnificent Seven and value stocks lagged. BRAI’s rating started to recover in October, helped by the expected tender offer, and is now at a more reasonable level. The board hopes investors will support the new strategy and help the trust grow again.

Conditional tender offers

If BRAI does not outperform its benchmark by at least 0.5% a year after fees over three-year periods (the first ending 30 April 2028), it will offer shareholders a 100% tender at a 2% discount to NAV after costs. This tender offer will also be made if the company’s net assets fall below £125m at the end of any of these periods.

Figure 9: BRAI’s premium/(discount) over the five years ended 31 October 2025

Source: Bloomberg, Marten & Co

Structure

Capital structure

BRAI has 95,361,305 ordinary shares, with 38,949,167 held in treasury, leaving 56,412,138 shares with voting rights. Its financial year ends on 31 October, with AGMs usually in March. The board plans to announce the next annual accounts in January 2026. Shareholders approved the company’s continuation at this year’s AGM, with the next vote set for 2028 and every three years after that.

Fees and costs

From 17 April 2025, BRAI’s management fee is tiered: 0.35% on the first £350m of NAV and 0.30% on any amount above that. There is no performance fee.

The ongoing charges ratio for the year ended 31 October 2024 was 1.06%, based on the previous 0.70% management fee. With the reduced fee, this ratio should be significantly lower in this and future years. The board has estimated that over a full 12-month period under the new fee, the ongoing charges ratio is expected to decrease to around 0.70%–0.80%.

The managers

BRAI’s alternative investment fund manager is BlackRock Fund Managers Limited, while BlackRock Investment Management (UK) Limited serves as its investment manager and company secretary. The lead managers for BRAI are Travis Cooke and Muzo Kayacan.

Travis Cooke

Travis leads the US portfolio management group in BlackRock’s systematic active equity team, overseeing US long-only, partial long-short, and long-short equity strategies. He joined Barclays Global Investors in 1999, which merged with BlackRock in 2009, and was previously a portfolio manager for developed market strategies in the alpha strategies group. Travis holds a BA in Business Economics from the University of California, Santa Barbara (1998), an MSc in Finance from London Business School (2008), and has been a CFA charterholder since 2001.

Muzo Kayacan

Muzo is a portfolio manager and head of EMEA product strategy in the SAE division. He manages US, global, and European funds, and leads the EMEA product strategy team, which connects investment teams and clients.

Before joining BlackRock in 2010, Muzo was a senior associate portfolio manager at AllianceBernstein, where he implemented investment decisions for global equity portfolios and managed currency hedging strategies. From 2005 to 2007, he completed a graduate training scheme at M&G and then worked in product development. Earlier, he was a futures trader.

The board

BRAI has four non-executive directors, all independent of the manager. Alice Ryder stepped down as chair and director after the last AGM, with David Barron taking over as chair. Gaynor Coley is the newest director and now chairs the audit committee, replacing David Barron.

Figure 10: Directors’ length of service, fees, and shareholding

	Role	Appointed	Length of service (years)	Fees (£)	Shareholding
David Barron	Chairman	22/03/2022	3.7	45,000	11,677
Gaynor Coley	Chair of the audit committee	25/06/2025	0.4	39,000	10,000
Solomon Soquar	Senior independent director	21/03/2023	2.7	32,500	10,000
Melanie Roberts	Director	01/10/2019	6.2	32,500	10,000

Source: Marten & Co

David Barron

David has 25 years’ experience in investment management. He was chief executive of Miton Group Plc until November 2019, after six years with the company. Before that, he spent over 10 years as head of investment trusts at JPMorgan Asset Management, joining Robert Fleming in 1995. He is now chairman of Baillie Gifford European Growth Trust Plc and, until its planned merger, a non-executive director of Fidelity Japan Trust Plc.

Gaynor Coley

Gaynor Coley is a chartered accountant with over 30 years’ experience in private and public sector finance, focusing on governance, compliance, and risk management. She is a non-executive director and audit committee chair at Foresight Enterprise VCT Plc and Lowland Investment Co Plc, and also chairs the grants committee and serves as a trustee for the Duchy Health Charity.

Solomon Soquar

Solomon Soquar has over 30 years’ experience in investment banking, capital markets and wealth management. He has held senior roles at major firms such as Goldman Sachs, Bankers Trust, Merrill Lynch, Citi and Barclays, most recently serving as CEO of Barclays Investments Solutions Limited. In recent years, he has taken on a range of roles, including non-executive director at Ruffer Investment Company Limited, chair of the Africa Research Excellence Fund, and business fellow at Oxford University’s Smith School of Economics and Enterprise.

Melanie Roberts

Melanie Roberts is a partner at Sarasin & Partners LLP with 29 years of investment experience. She joined the firm in 2011 and became head of charities in January 2023, focusing on strategy, stewardship, and client service for charity portfolios. Before this, she spent 16 years at Newton Investment Management managing charity, private client, and pension fund portfolios.

IMPORTANT INFORMATION

Marten & Co (which is authorised and regulated by the Financial Conduct Authority) was paid to produce this note on BlackRock American Income Trust Plc.

This note is for information purposes only and is not intended to encourage the reader to deal in the security or securities mentioned within it. Marten & Co is not authorised to give advice to retail clients. The research does not have regard to the specific investment objectives financial situation and needs of any specific person who may receive it.

I Am Betting Big On This Near-Perfect 8%-Yielding Income Machine For Early Retirement

Samuel Smith

Dec. 02, 2025

Summary

• This 8%-yielding machine is positioned for very strong upside, growing passive income, and relatively low risk.
• The market is ignoring this unrivaled combination of quality, growth, and high yield.
• Don’t miss out on three of my largest holdings.

I love investing in high-quality, high-yielding stocks that trade at attractive valuations because I believe that this is one of the surest paths to generating long-term total return on performance. This is because these types of companies do not need to deliver much in the way of growth. They still deliver a satisfactory 10 to 12% annualized total return that is in line with long-term averages for the S&P 500 (SPY) and dividend growth ETFs like the Schwab U.S. Dividend Equity ETF (SCHD).

However, by investing in individual stocks on a value basis, you can then overlay a capital recycling strategy to further accelerate the compounding process by selling these types of stocks once they appreciate the full value, and then recycling the capital to other attractively valued high-yielding opportunities.

In today’s article I am going to share are three of some of my highest conviction high-yield bets right now that I have significantly outsized positions in, and I believe will take me a long way towards achieving my passive income goals due to their high yields, high quality, and attractive valuations.

A Tax-Deferred Energy Infrastructure Gem

The first opportunity I’m going to talk about is Enterprise Products Partners (EPD). It is a leading midstream energy infrastructure MLP (AMLP) that issues a K-1 tax form. While some may view that as a deal breaker, I love it because it generally means that the distributions are tax deferred until I sell, and if I never sell my EPD units and I purchase more units over time to keep my cost basis above zero and then pass them on to my heirs, I will never pay taxes on them. Either outcome would be a win for me because if I sell my units, it means that they likely delivered significant total return outperformance, and I can still sell them at long-term capital gains rate, and if I never sell, then I get a lot of passive income tax-free and can pass on a high-quality income machine to my heirs.

EPD’s strength derives from its high-quality, fully integrated, and well-diversified portfolio of energy infrastructure, including pipelines, storage assets, processing plants, and export terminals for natural gas liquids, crude oil, and natural gas. Additionally, the vast majority of its cash flow is contracted and fee based, which means it is fairly well insulated against commodity price volatility.

Not only that, but it also has the only A- credit rating in the midstream sector, reflecting the fact that it has the strongest balance sheet among peers, including C-corporations like Enbridge (ENB) and Kinder Morgan (KMI). This is not surprising given that it has a 3.3x leverage ratio that is likely going to plummet next year as significant projects come online and begin generating EBITDA. Additionally, it has $3.6 billion of liquidity with a 17-year weighted average return to maturity on its debt.

Moreover, its distribution of nearly 7% on a next twelve-month basis is covered 1.5x by distributable cash flow, and that coverage ratio should only increase over the coming year as projects come online and it initiates a unit repurchase program that should, both of which should contribute to an improving distribution payout ratio. When you combine the company’s fundamental strength with its attractive yield and the potential for significant buybacks next year due to it authorizing a $3 billion buyback authorization with expected decline in growth capex by at least $2 billion next year, freeing up significant free cash flow, EPD looks very compelling right now.

High-Yield Exposure to Private Credit

The next income machine I am going to talk about is Morgan Stanley Direct Lending (MSDL), which is a business development company (BIZD) that is managed by Morgan Stanley (MS). My favorite thing about MSDL is that about 96% of its portfolio is invested in first lien senior secured loans. When combined with the fact that they are primarily sponsor-backed businesses with low-weighted average loan-to-values of about 40%, and the fact that MS is a reputable manager that owns about 11% of the underlying equity in MSDL and charges one of the most shareholder-friendly fee structures, I have a high degree of confidence in MSDL’s fundamental performance moving forward.

Thus far, it has done very well on that front, as non-accruals are only 1.2% of the portfolio cost and 0.6% at fair value, and PIK income remains one of the lowest in the sector at just 4% of total income, which is in fact about half of the sector’s average. The company also fully covers its dividend with $0.50 per share in net invested income this past quarter that is in line with its $0.50 per share quarterly dividend.

Additionally, it has been making improvements to its balance sheet by closing its first CLO at an attractive SOFR plus 1.7% rate, and also repriced its asset-based facility to SOFR plus 1.95%, which combined to help offset some of the headwinds against recent Federal Reserve rate cuts to net investment income per share. With the discount to NAV sitting at a mid-teens percentage at a time when peers like Ares Capital Corporation (ARCC) and Blackstone Secured Lending (BXSL) trade roughly in line with NAV, MSDL looks extremely cheap. In addition, it pays an 11.7% dividend yield that is fully covered by underlying net investment income, and even if it has to trim its sum due to future Federal Reserve rate cuts, it is still likely to remain at 10% or above on its current stock price for the foreseeable future, making it a very good source of passive income.

An Alternative Asset Manager with Massive Growth

The third income machine I am going to talk about today is Blue Owl Capital (OWL), which is an alternative asset manager similar to Blackstone (BX) and Brookfield Asset Management (BAM)(BN). It invests across three major business segments including direct lending, GP stakes, and real assets.

Its direct lending business represents about half of its assets under management and has been a big driver of its recent growth due to the boom in private credit and direct lending. GP stakes has also been performing well given the growing interest in alternatives and its real assets business has seen strong performance in its triple net lease business and explosive growth thus far in its digital infrastructure business as the company is making investments in the data center build-out for hyperscalers like Meta (META). With management fees up 29% year-over-year and company posting record fundraising of $57 billion over the past 12 months with $28 billion of undeployed capital that is expected to generate an additional $360 million in annual management fees as it is deployed, OWL has phenomenal growth momentum right now. In fact, at their latest investor day, management guided for an over 20% fee-related earnings per share CAGR over the next five years. When combined with its current 6% dividend yield and its investment grade balance sheet, OWL appears to be a very attractive combination of high current yield and very strong growth for the foreseeable future.

Risks & Investor Takeaway

Of course, no investment is risk-free. While EPD is a low-risk investment, its unit price does remain sensitive to energy price volatility in the near term, even if its cash flows are much more resilient. Additionally, it is heavily invested in NGL exports, which are dealing with some overcapacity challenges right now, and its significant investments in growth projects do expose it to execution risk, even if its track record is very strong.

MSDL is invested in the private credit space, which has been receiving a lot of negative press recently. While I believe that much of this is unwarranted hype, it is true that there is a possibility that the sector has engaged in risky lending practices and or a material economic downturn could lead to a spike in non-accruals. Additionally, the Federal Reserve’s potential to accelerate rate cuts under President Trump’s replacement for Jerome Powell next year could weigh heavily on net investment income per share and lead to a material dividend cut. However, this would likely affect the entire sector, so we do not think that MSDL will be penalized by Mr. Market for it. Instead, its performance will likely be much more dependent on its underwriting performance. Given the huge discount to NAV, we think the upside potential is much greater than the downside potential.

Finally, OWL is also exposed to private credit, which has been receiving a lot of negative press recently and is also invested in the digital infrastructure space, which is also suffering from concerns about an AI bubble. However, OWL’s private credit business has a 10-year track record with extremely low loss rates and is showing no signs of distress today. Moreover, its digital infrastructure business is grossly misunderstood as it has contractual guarantees in its arrangements to companies like Meta that help to insulate it from downside risks should the AI capex boom turn into a bubble and fail to deliver on current expectations.

Given my confidence and high degree of conviction in these businesses, I am making big bets on each of them. Between them, I enjoy an average yield of over 8%, giving me significant passive income in my push towards eventually achieving early retirement from dividends. It should therefore be of little surprise, then, that all three make up some of my largest positions at High Yield Investor.

Young Caucasian girl showing and pointing up with fingers number three against yellow background© Provided by The Motley Fool

Story by John Fieldsend 1 Year ago

How much more money would I have if I’d avoided every ISA mistake I made? Probably a fair bit, sadly. I can’t have my time again, but I can share what I have learnt here.

No early bird

The first time I had a bit of cash to spare was at 16, thanks to an unglamorous role at the local Kentucky Fried Chicken. Many hours assembling Zinger burgers and salting french fries netted me a few hundred quid a month. What did I spend it on ? I can’t even remember. 

Perfectly balanced

My second ISA mistake was thinking that stocks and markets would even out. The US and other Western countries had been dominant, so why not look at China and developing countries instead? Why not look at stagnating companies over high-flying ones? They were bound to catch up, weren’t they? 

Billionaire investor Warren Buffett would have had a field day with me. One of his most famous quips is: “For 240 years, it’s been a terrible mistake to bet against America.”

He could also point out that thriving stocks and stock markets stay near all-time highs. The FTSE 100 hit an all-time high this May. It’s still only a hair’s breadth away. The S&P 500 just hit an all-time high five minutes ago (as I write)! 

Interest rates

My third ISA mistake was choosing the wrong type of account. I realised with a very visceral feeling how the first month returned around 40p, or so. Although modest, my life savings were in there. That I was getting nothing back for it felt like a gut punch. 

Of course, I had opened a Cash ISA at near 0% interest rates. Had I known that these types of savings accounts don’t beat inflation by much – by design – then I might have looked elsewhere. 

If I could roll back the years then the first step would be opening a Stocks and Shares ISA instead, and the second step would be going for an income stock like National Grid (LSE: NG). It’s a reliable dividend payer, yielding 5.24% at present. A steady and sizable stream of cash would be nice on its own but would also provide reassurance that my money was working for me. 

Reliable really is the key word here too. The company has a monopoly on its UK operations which offer very stable cash flows. This allows the company to slowly increase dividends with its current 10-year growth rate at 2.9%.

The firm does face large capital expenditure as the country moves towards net zero obligations. Another downside is it’s a stock that will likely produce more income than growth in the years ahead. These are the main reasons it’s not in my portfolio today. But for the right kind of investor, this stock’s one to consider.

Note the date of the above article, NG has outperformed VWRP.

NESF

Dividend:
·
Total dividends declared in the period of 4.21p per Ordinary Share (30 September 2024: 4.21p).
·
Dividend cover for the period was 1.7x (30 September 2024: 1.5x).
·
The Board reconfirms the Company’s full-year dividend target guidance for the year ending 31 March 2026 remains unchanged at 8.43p per Ordinary Share (31 March 2025: 8.43p).
·

Dividend cover for the full-year is forecast to be covered in a range of 1.1x – 1.3x by earnings post-debt amortisation.
·

As at 02 December 2025, the Company offers an attractive dividend yield of c.16% and since inception has declared total Ordinary Share dividends of £419m, the equivalent to 80.5p per Ordinary Share

It could be possible for long term holders to achieve the holy grail of investing in having a share that has returned all your capital in dividends and pays you a dividend. You would also be earning income on the re-invested dividends.

Sadly for long term holders the yield, will not be 16% but the buying yield of around 5%, increasing over the years held to 8.5%.

The yield if bought at the high of around 124p would less.

Current yield 15.7% Discount to NAV 41%.

10 hottest, funds and trusts: week ended 28 November 2025

We reveal the 10 most-popular, funds and investment trusts added to ISAs on the interactive investor platform during the past week.

1st December 2025 15:24

by Lee Wild from interactive investor

We look at the investments ii customers have been buying within their ISAs during the previous week. The data includes only real-time trades, not regular investing instructions, and combines the use of both existing funds and new money.

• Invest with ii: Open a Stocks & Shares ISA | ISA Investment Ideas | Transfer a Stocks & Shares ISA

Top 10 funds and trusts in ISAs

	Company Name	Place change
1	Royal London Short Term Money Market Y Acc	Unchanged
2	Vanguard LifeStrategy 80% Equity A Acc	Up 2
3	3i Group Ord III1.18%	Down 1
4	Greencoat UK Wind UKW0.21%	Up 6
5	L&G Global Technology Index I Acc	Up 2
6	Vanguard LifeStrategy 100% Equity A Acc	New
7	Scottish Mortgage Ord SMT0.38%	Down 2
8	Artemis Global Income I Acc	Down 2
9	Vanguard FTSE Global All Cp Idx £ Acc	Unchanged
10	HSBC FTSE All-World Index C Acc	Down 2

Top 10 funds and trusts in ISAs

Renewables play Greencoat UK Wind 

UKW

0.21%

 has climbed back up the bestsellers list for the week as its shares continue to trade on a hefty discount.

The trust, which moves up by six places this week, hasn’t had any major updates in recent days but the shares do trade on a discount of almost 29% to net asset value (NAV) and offer a dividend yield of 10.4%.

Bizarrely, the trust actually trades on a tighter discount than almost all its peers, although investors might like the sheer scale of the fund among other things.

Investors continue to spot a bargain in the form of 3i Group Ord 

III

1.18%

, whose enormous share price premium has come in somewhat over recent weeks. One other trust, investor favourite Scottish Mortgage Ord 

SMT

0.38%, also remains in the list.

A handful of other names from the investment trust sector, City of London Ord 

CTY

0.00%

, NextEnergy Solar Ord 

NESF

3.28%, Henderson Far East Income Ord HFEL0.84% and Polar Capital Technology Ord PCT0.99%, sit just outside the top 10.

Elsewhere, some popular choices continue to turn investors’ heads. Vanguard’s LifeStrategy franchise, which offers a mixture of exposure to stocks and bonds and has an underweight allocation to US equities, keeps selling well.

Vanguard LifeStrategy 80% Equity A Acc moves up to second place, while Vanguard LifeStrategy 100% Equity A Acc moves back into the top 10, having been in 12th place a week before.

The Royal London Short Term Money Market Y Acc fund maintains the top spot, with Rachel Reeves’ plan to restrict the amount of money put into Cash ISAs each year possibly further highlighting the appeal of such a product.

Meanwhile, other names from L&G Global Technology Index I Acc to Artemis Global Income I Acc and two other global trackers, make the list.

Funds and trusts section written by Dave Baxter, senior fund content specialist at ii.

Top 10 most-purchased ETFs: November 2025

ETF investors are still loving precious metals but US equity plays are catching up.

2nd December 2025 11:20

by Dave Baxter from interactive investor

Cryptoassets are very high risk and you should be prepared to lose all your money before you invest

• Bitcoin and crypto stocks: examining the risk

US equity trackers bolstered their presence in our November bestsellers list, although investors are still showing plenty of appetite for precious metals exposure. 

Our monthly tables are based on the number of buys, with regular investing excluded. 

• Invest with ii: Top ETFs| Index Tracker Funds | FTSE Tracker Funds

The iShares Physical Gold ETC GBP 

SGLN

0.85%

 remains at the top of our list, with investors likely continuing to chase the yellow metal’s strong performance.

This fund, which simply tracks the spot gold price as opposed to holding the likes of gold mining shares, has returned more than 50% over a 12-month stretch. All performance figures are given in sterling terms. 

The iShares Physical Silver ETC GBP 

SSLN

1.14%

, which has had an even better run, also remains in the top 10. But precious metals funds are losing some ground: the silver ETC slips two places, while the racier Global X Silver Miners ETF USD Acc GBP 

SILG

3.11% fell out of the list entirely. 

The two share classes of the Vanguard S&P 500 UCITS ETF GBP 

VUSA

0.06%

 creep up to second and third place in this month’s list, showing that investors haven’t lost their appetite for the market even in a year where it has trailed many of its peers. 

Elsewhere, investors are getting similar exposure via global equity trackers. There’s the Vanguard FTSE All-World UCITS ETF GBP 

VWRL

0.09%

 and its accumulation share class, as well as the iShares Core MSCI World ETF USD Acc GBP 

SWDA

0.15%. 

Note that with both the US and FTSE All-World trackers, investors have made good use of the distributing share classes, which pay out dividends, even though these markets are not especially high-yielding. Investors may well be better off using the accumulating share classes, which reinvest the dividends and do a better job of compounding returns over time. 

A new name that entered the list demonstrates the enduring appeal of cash-like investments. 

Amundi Smart Overnight Ret GBP H ETF Acc 

CSH2

0.01%

 looks to pay out the base interest rate, and has held up well against the competition as per our analysis from early 2025. The popularity of this fund chimes with that of an investor favourite from the open-ended space, Royal London Short Term Money Mkt Y Acc. 

Elsewhere some racier ETFs remain popular. There’s the Invesco EQQQ NASDAQ-100 ETF GBP 

EQQQ

0.59%

, a well-established play on the tech sector with big positions in Magnificent Seven members NVIDIA Corp 

NVDA

0.86%, Apple Inc AAPL1.09%, and Microsoft Corp MSFT0.67%.

But as our recent analysis shows, there are in fact some even racier tech funds out there. 

Remaining in the list, the VanEck Crypto&Blckchan Innovtr ETF A USD GBP 

DAGB

2.11%

 is still very popular among ii customers.

It has a decent chunk of its portfolio tied up in top holdings such as IREN Ltd 

IREN

15.20%

, BitMine Immersion Technologies Inc 

BMNR

10.26%, Applied Digital Corp APLD0.57% and Coinbase Global Inc Ordinary Shares – Class A COIN1.32%. 

It has enormous returns at points, although the fund’s sector of choice also means it can be extremely volatile. The performance figures in the table illustrate this well: the fund has returned more than 400% over a three-year period, but less than 2% over the last year. 

Top 10 most popular ETFs in November 

Ranking	Exchange-traded fund (ETF)	Change from October	One-year return to 30 November 2025 (%)	Three-year return to 30 November 2025 (%)
1	iShares Physical Gold ETC GBP SGLN0.85%	Unchanged	51.5	114.1
2	Vanguard S&P 500 ETF USD Acc GBP VUAG0.08%	Up 1	10	56.2
3	Vanguard S&P 500 UCITS ETF GBP VUSA0.06%	Up 1	10	56.2
4	iShares Physical Silver ETC GBP SSLN1.14%	Down 2	68.1	123.4
5	Vanguard FTSE All-World UCITS ETF GBP VWRL0.09%	Unchanged	13.6	50
6	VanEck Crypto&Blckchan Innovtr ETF A USD GBP DAGB2.11%	Unchanged	1.9	405.4
7	Invesco EQQQ NASDAQ-100 ETF GBP EQQQ0.59%	Unchanged	17	92.2
8	Vanguard FTSE All-World ETF USD Acc GBP VWRP0.11%	Up 1	13.6	50
9	iShares Core MSCI World ETF USD Acc GBP SWDA0.15%	Up 1	12.3	52.1
10	Amundi Smart Overnight Ret GBP H ETF Acc CSH20.01%	New	2.8	10.2

I’ve bought for the Snowball 16014 shares in ENRG VH Global Energy Infrastructure For 10k

XD Thursday for a dividend of 1.45p, a yield of 9%

£232.00 payable 08/01/2026

As at 30 June 2025, the Company’s NAV per share was 100.90p, a decrease of 2.2% during the six-month period under review. The primary driver of the decrease in NAV per share was unfavourable foreign exchange rate movements, with GBP strengthening against USD and AUD.

In line with the dividend target for the year ending 31 December 2025 of 5.80p per share, the Company has paid a quarterly dividend of 1.45p per share with respect to Q1 2025 as well as a dividend of the same amount per share with respect to Q2 2025, giving a total of 2.90p per share for the period, compared to 2.84p per share for the first half of 2024, an increase of 2.1%.

Following the announcement of the Proposed Asset Realisation Strategy, the Board intends to continue paying a quarterly dividend to shareholders. As the Proposed Asset Realisation Strategy progresses, the size of the quarterly dividend will depend on the level of net income generated by the assets that remain in the portfolio (noting that some assets are more cash generative than others).

I’ve sold the Snowball shares in FGEN for a profit of £322.00. They were bought to collect the dividend but the Snowball only owned them for a few days and the profit equalled the dividend it was to good to ignore.

The Dark Side Of High-Yield CEFs And Covered Call ETFs

Nov. 30, 2025

Samuel Smith Investing Group

Summary

• High-yield CEFs and covered call ETFs lure in investors with juicy yields.
• However, there are several hidden dangers lurking beneath the surface of many of these funds.
• There is a better way to generate high-yielding passive income and potential long-term total return outperformance.

A very popular investing strategy is to buy a diversified portfolio of double-digit-yielding closed-end funds (“CEFs”) and exchange-traded funds (“ETFs”). The reason this approach is a well-traveled path is that, especially for retirees, such massive passive income can sufficiently cover their living expenses without having to amass a huge nest egg. Additionally, the appeal is that you do not need any growth from your investments. You simply need the cash to continue flowing in from distributions to still generate a pretty decent equity-like 10%-ish return. However, in my view, this strategy is flawed, and I think it makes a lot more sense to generate income to cover living expenses from a different investing strategy, and in this article, I will detail why as well as what the better approach is.

Why High-Yield Funds Fail To Deliver Long-Term Stability

The simplicity of the approach of just buying a diversified set of double-digit-yielding funds certainly has its appeal and its perks. In particular, it takes out the emotional aspect as well as the potential for human error. If you buy diversified portfolios, you greatly reduce the landmine risk that comes from putting too much capital into one or two highly risky individual stocks, and you can generally better buy and hold such diversified investments due to their somewhat more stable nature than having to ride the highs and lows that come with individual stock picking. However, if you can learn to master your emotions, that removes much of the advantage that comes with this simpler approach, and yet, if you still stick with the diversified high-yielding fund approach, you are still saddled with several downsides.

The Hidden Dangers Of Leverage And Covered Calls

The first big downside is that many of these funds employ significant leverage to enable them to achieve such high yields. That puts them at enormous risk because if the market (SPY) were to crash suddenly, they may get hit with margin calls, which can force them to sell their holdings at the worst possible time, thereby locking in permanent loss of capital and loss of underlying income-generating ability in those funds. This can also lead to painful dividend cuts from the funds, or even if they do not cut the dividend, they begin to erode NAV quite rapidly due to paying out much more in distributions than they generate internally.

Additionally, if you are generating a double-digit yield from a covered call ETF or CEF, even if it is not leveraged, this can still have a similar effect. This is because if the fund crashes suddenly with a broader market and then goes to write its monthly call options to generate lucrative income in the months following that sharp drawdown, it is also setting itself up to potentially lock in permanent losses should the broader market rally sharply. This thereby effectively forces the fund to sell its underlying holdings due to the covered calls expiring in the money at prices that are potentially much lower than they were when you first bought the fund. This can also lead to long-term net erosion, as is evidenced by the Global X Nasdaq 100 Covered Call ETF (QYLD)’s poor NAV per share performance over time despite its underlying index (QQQ) doing very well.

However, even in cases where there are funds like NEOS NASDAQ-100(R) High Income ETF (QQQI), Neos S&P 500(R) High Income ETF (SPYI), Goldman Sachs S&P 500 Premium Income ETF (GPIX), and Goldman Sachs Nasdaq-100 Premium Income ETF (GPIQ) that have managed to implement somewhat actively managed flexible call-writing strategies that do preserve some upside during recoveries, as well as some leveraged funds like the Cohen & Steers Real Estate Income Fund (RQI) and others that have managed to navigate market crashes without having to slash their distribution, you are still also saddled with fairly high expense ratios. This is particularly the case with CEFs, which tend to charge much higher expense ratios than actively managed covered call ETFs do.

Even in the case of QQQI and SPYI, you are still paying a pretty hefty 0.68% expense ratio, which is materially higher than what you would pay for holding the underlying index that they have, and yet those funds also underperform the underlying indexes over time, as evidenced by their performance thus far.

A Better Way: Building Your Own High-Yield Portfolio

Given the flaws of CEFs and ETFs, the approach I implement is to build a diversified portfolio of about 25 individual stocks, give or take 5 to 10 on either side. Additionally, I make sure that the vast majority of them are durable, defensive business models with strong balance sheets, mid to high single-digit yields with an occasional double-digit yield if the market seems to be exceptionally mispricing a security, such as it recently did with Plains All-American Pipeline (PAA) when I bought it at an over 10% next 12-month projected yield.

I then also focus on companies that are growing their dividends year after year on a moving forward basis or that are likely to continue growing their dividends every year moving forward, while also at a pace that meets or beats inflation. Beyond that, I also want to make sure that the dividend is fully covered by cash flows and ideally comfortably covered by cash flows, or at least will be in the near future due to significant projected oncoming growth. Ultimately, I want to make sure that both the dividend payout and the dividend growth are sustainable.

What this produces is a diversified portfolio of individual businesses that are quite easy to create a fairly narrow fair value range on. This means that, especially on a diversified basis, it is unlikely that I am going to suffer significant long-term permanent impairments to the portfolio relative to the broader market (SPY). Meanwhile, I can just sit back and let volatility work for me. As certain sectors and individual securities move in and out of favor, I can trim and even sell the ones that appreciate close to fair value and then add more to the ones that move out of favor and trade at a big discount as long as their underlying business fundamentals remain sound. I then rinse and repeat and can continue this process, all the while collecting attractive income and seeing my underlying dividend per share in those holdings increase, and thereby, in most cases, their intrinsic value also increases while I wait for the market to wake up to the embedded value.

Yes, I make my share of mistakes. However, the vast majority of the time, my mistakes stem from either not paying enough attention to the true state of the balance sheet, as is the case with Algonquin Power & Utilities (AQN), or trying to bet on a cyclical business and mistiming the state of the industry. In the case of LyondellBasell Industries (LYB), I ran into a case where it has had a historically long downturn.

As far as the industries that tend to be the most durable and defensive and that I therefore tend to overweight, these include midstream (AMLP) businesses like Enbridge (ENB) and Enterprise Products Partners (EPD), utilities (XLU), and infrastructure (UTF) businesses like Brookfield Infrastructure Partners (BIP)(BIPC) and Clearway Energy (CWEN)(CWEN.A), real estate (VNQ), especially triple net lease REITs like Realty Income (O) and W.P. Carey (WPC), as well as multifamily REITs like MidAmerica Partners (MAA), and alternative asset managers like Blackstone (BX), Brookfield Asset Management (BAM)(BN), and Blue Owl Capital (OWL).

With a diversified portfolio of these sorts of businesses, the math becomes quite clear: you get a mid- to high-single-digit yield, as well as a single-digit annualized growth rate that puts you at an aggregate 10% to 12% target annualized rate of return. Then you ensure that you buy these businesses on a value basis and sit back, relax, let the dividends flow, let the growth compound, and ultimately wait for the market to reappraise the business closer to fair value. At this point, you can sell it and recycle the capital into new opportunities like this and repeat the process. This strategy then has the potential to turn a 10% to 12% annualized total return into a 15%+ annualized total return target thanks to the valuation multiple expansion component of the investment thesis.

Investor Takeaway

While CEFs and ETFs certainly keep things simple and can lure investors in with juicy yields and high-quality companies in their underlying holdings, they suffer from a few major flaws. CEFs use a lot of leverage and charge steep management fees in most cases, while covered call ETFs cap significant upside and therefore can lead to long-term underperformance relative to their underlying index, in addition to charging higher fees than the underlying index ETFs charge. Additionally, neither of these types of funds makes use of opportunistic capital recycling on a value basis in most cases, and they tend to be very broadly diversified, which limits their ability to take truly high-conviction positions and generate meaningful alpha for investors. Additionally, given that the broader market looks quite overvalued right now, these index-like or, at the very least, closet-indexing funds face an increasingly daunting path to achieving outperformance moving forward.

Given all these weaknesses of investing in high-yielding CEFs and covered call ETFs, I have found that building a portfolio of sufficiently diversified mid- to high-yielding stocks that also grow their dividends at a rate that meets or beats inflation over time and then implementing value-investing principles and opportunistic capital recycling can deliver total return outperformance of not only covered call ETFs, dividend growth ETFs like the Schwab U.S. Dividend Equity ETF (SCHD), and leveraged high-yield CEFs, but also the S&P 500 (VOO), while delivering higher yields and similar to even stronger dividend growth over time.

The Snowball 2026.

Whilst Investment Trusts trade at an above market average and return a higher yield, the Snowball will continue to hold and trade Investment Trusts, whilst building up a knowledge in ETF’s and CEF’s.

Remember with a dividend re-investment plan you fail by the month and not the year. I have crunched the fcast dividends and the expected total income for 2026 is

£9,884 meeting the fcast.

Remember no dividend is 1000% safe and some dividends could be trimmed. If the dividend is drastically changed the share will be sold and re-invested back into another higher yielder.

As a buffer, as dividends are received they will be re-invested back into the portfolio earning more income.

Hopefully some dividends will be gently increased to allow for inflation.

The target for the year is 10k.

2025 dividends to date £10,879.00