If you still believe that the Energy bull is very much alive and prices will either hold steady or go much higher over the coming years then this closed end fund looks very interesting especially as it currently trades at around a 10% discount to NAV.
We say ‘lower’ risk purely because the fund diversifies its investments.
The Blackrock Global Energy & Resource Trust
22% invested in Canada, 57% US, 21% other
No stock holding greater than 3% of the size of the fund
Stock holdings include Peabody, Magellan, Energy Transfer, Consol, Kinder Morgan, Arch Coal, Penn Virginia, EOG, Natural Resource Partners
5.5% dividend compared with 1% for Exxon
Summary
We like the fund because it’s far less concentrated in ‘big oil’ than say the ETF XLE. If energy stocks are a cornerstone of your portfolio then you should seriously consider this fund.
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