RNP and RQI

[sam]

RNP has increased its distribution almost 10% few months ago. $0.124 to 0.136 monthly. I thought most of leverage CEF will be in trouble as cost of leverage goes up their distribution might get cut or you will get ROC. RNP most of their current distribution is coming from capital gains so they might be selling shares/assets of portfolio to support distributions. Same story is with RQI where distribution is short term capital gains (no distribution increase with RQI).

NCZ and NCV are prime example as for past many months their all of their distributions are ROC. Not sure how, as most market or economy slowdown as just has begun and cooperate bankruptcy rate is still very low.

Q. is where income or coupon payment is going?

[ECE Prof]

I do not know much about RQI. I am giving a generic explanation down here.

In my opinion, as cost goes up for the leverage portion (29%), the interest earned by the total (equity+leverage) goes up even more, as uncleharley explained in another thread. By law, all CEF funds have to distribute 90% of the income within the year. The interest rate increase is a double-edged sword. So, if RQI earns more in real estate fund due to various reasons, it is possible to increase the distribution. Check for its UNII report, if it is available. It would tell the story.