Close End Funds get hammered!- That's Illiquidity and info. asymmmetry for you

In September, the median discount for all closed-end funds

(CEFs) widened an amazing 687 basis points (bps) to 16.05% (the largest overall end-of-month discount in over ten years), almost doubling the 12-month average of 8.46%.

- The global credit crisis and recent failure of supportive legislation led to dramatic declines in equity CEFs (-13.22%) and fixed income CEFs (-8.31%) returns for the month of September, and the lot cumulatively posting a minus 10.14% return on a NAV basis.

- On the stock side Domestic Equity Funds (-10.89%) and World Equity Funds (-14.35%) mitigated losses better than their Mixed-Equity Funds (-19.15%) counterpart.

- For the month only 13 funds were able to post plus-side returns, leaving 668 funds underwater and one at the breakeven mark.

- The Income & Preferred Stock Funds (-21.12%) classification posted the worst return in the CEF universe