Among Closed-End Funds, Energy Still Tops

We compiled a list of the best-performing closed-end funds within each fund objective for the month of May. As was the case with ETFs, the groups of closed-end stock funds generally outperformed fixed-income funds. Energy again powered its way to the top.

The best energy and natural resource, closed-end fund in May was the Kayne Anderson Energy Total Return Fund(KYE Quote). It returned 8.20% for the month. At last measure, three pipeline companies were the largest holdings, with Kinder Morgan Management(KMR Quote) totaling 11.88% of fund assets followed by 5.38% in Plains All American Pipeline(PAA Quote), and 3.82% in Enterprise Products Partners(EPD Quote).

The second-best average closed-end fund objective for May was the domestic growth sector. Here, the best fund is the B+ rated Royce Focus Trust(FUND Quote), earning 13.76%. The wrinkle is that this fund seeks long-term capital growth by picking smaller stocks perceived to be a good value. Some of the best performing holdings in May were Timberland(TBL Quote), up 26.10%; Allied Nevada Gold(ANV Quote), up 24.80%; and Sanderson Farms(SAFM Quote).

The best-performing fund on the list is from the non-U.S. equity group. The Morgan Stanley Eastern Europe Fund(RNE Quote), which gained 15.39% for the month, would be worthy of consideration for the "R" portion of a "BRIC" portfolio. Russia accounts for 69.9% of fund assets, with Gazprom OAO, MMC Norilsk Nickel and Lukoil as the top three holdings. The positions advanced 13.53%, 10.68%, and 25.06%, respectively, in May.

Best Performing Funds in May for Each Closed-End Fund Objective
Objective	Avg May Perf	Fund (Ticker) Rating	May 2008 Total Return
Sector - Energy/Natural Res	5.43	Kayne Anderson Energy Tot Ret (KYE) C+	8.20
Growth - Domestic	4.96	Royce Focus Trust (FUND) B+	13.76
Sector - Precious Metals	4.95	Gabelli Global Gold Nat Res&Income (GGN) B+	6.90
Global Equity	4.20	Cohen&Steers Worldwide Realty Inc (RWF) D-	14.09
Emerging Market Equity	3.88	Templeton Emerging Markets Fd (EMF) C+	6.73
Sector - Utilities	3.42	Cohen&Steers Select Utility Fund (UTF) B+	6.60
Growth & Income	3.36	LMP Real Estate Income Fund Inc (RIT) C	9.82
Non-US Equity	2.71	Morgan Stanley Eastern Europe (RNE) C+	15.39
Equity Income	2.54	Claymore Raymond James SB1 Ety Fd (RYJ) E+	13.20
Sector - Health/Biotechnology	2.34	Engex (EGX) E-	6.03
Emerging Market Income	1.66	Western Asset Emerg Mkts Fltg (EFL) B+	3.70
Corporate - High Yield	1.47	Pacholder High Yield Fund (PHF) C-	6.88
Municipal Single State	1.40	BlackRock VA Muni Bond Trust (BHV) B-	8.47
Global Income	1.35	DWS Global High Income Fund (LBF) B	5.48
Municipal - National	1.26	Eaton Vance Insured Muni Bond II (EIV) D+	6.63
General Mortgage	0.96	PCM Fund (PCM) D-	3.97
General Bd - Investment Grade	0.83	BlackRock Broad Inv Gr 2009 Tm Tr (BCT) C	3.17
Government Bond	0.55	Western Asset/Claymore Inf-Link Sec (WIA) C+	1.56
Loan Participation	0.52	PIMCO Floating Rate Income Fund (PFL) C-	8.91
Municipal - High Yield	0.50	Western Asset Municipal High Inc (MHF) A-	5.47
Corporate - Investment Grade	-0.79	Rivus Bond Fund (BDF) C+	-0.79
Sector - Financial Services	-1.02	RMR F.I.R.E. Fund (RFR) E+	3.08
Multi-Sector Bond	-2.86	Highland Credit Strategies Fund (HCF) D-	2.57
Source: TheStreet.com Ratings

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