RA - Brookfield Real Asset Income Fund

[ValueMaven]

Has anyone ever looked at the Brookfield Real Asset Income Fund: ticker RA.  It doesn’t trade much, but has an asset base of around $900 million.  It is a closed-end fund which is trading at a decent discount of 7%, has minimal leverage, and has a 10% distribution yield.  Roughly 80% of the portfolio is in a blend of both  Corporate Credit, and Securitized Credit…the Corporate side is trading right around par, so this suggests a modest HY overweight vs. IG.  The securitized side is trading in the low 80s.  Additionally the other 20% of the Fund is allocated to Real Asset equities, which is really a blend of REITs, and Infrastructure/MLPs.

 

The leveraged adjusted duration of the CEF is just 2.13 yrs, which coupled with the discount to NAV and the yield is very interesting.  Plus you are getting the expertise of Brookfield’s Asset Management arm.

 

The Fund recently merged with two  other BAM CEF’s, which may have confused some investors….I bet at some point this trades at a premium just given the unique structure and holdings.  Could offer 15% upside over the next year or so, as its NAV spread tightens, and you receive monthly distributions. 

 

Please poke holes in this idea…

 

Sincerely,

VM