Chasing Yield? Here Are 10 CEFs Averaging a Near 10% Payout This July (2026)

Let's be honest, in today's market, finding truly compelling income investments feels a bit like searching for a needle in a haystack, doesn't it? Well, what if I told you we've sifted through a mountain of data to uncover a rare breed of opportunities? For income-hungry investors, we've zeroed in on a select group of ten closed-end funds, or CEFs, that are currently offering a rather eye-catching average yield of over 10% – all while trading at a sweet average discount to their net asset value (NAV) of nearly 7.7% here in July 2026. It's an intriguing proposition, to say the least.

But we didn't just throw darts at a board; oh no, a good deal of thought went into narrowing down this list. The selection wasn't arbitrary; it hinged on a careful evaluation of several crucial factors. We looked for CEFs that offer good sector diversification, demonstrating robust long-term outperformance, and importantly, funds with what appears to be sustainable distribution policies. Valuation, of course, played a significant role too. Our focus really spanned both equity-oriented and credit-focused CEFs, aiming for a well-rounded portfolio of income generators.

And for those who like to see the numbers, because really, who doesn't, these funds collectively tell quite a story. They've delivered some impressive annualized returns over various periods: a solid 18.2% over the last three years, a steady 9.7% over five years, and a consistent 9.6% when looking back a full decade. Pretty compelling, wouldn't you say? Our underlying income goal for this particular group was to find opportunities yielding 8% or higher, and these certainly clear that bar with room to spare.

Now, to give you a flavor of what we're talking about, consider the abrdn Emerging Markets ex-China Fund (AEF). This fund, for instance, is currently boasting a distribution yield of 10.6% and is trading at a notable 10% discount. And talk about performance – it absolutely soared in 2025, delivering an incredible 50% return! It sounds enticing, right? But here's where we tap the brakes for a moment: AEF does operate with a 10% managed distribution policy, which, for any diligent investor, naturally raises some questions about long-term sustainability. It's a reminder that even the most attractive yields require a closer look.

Beyond individual funds, it's always wise to cast an eye on the broader market landscape, isn't it? As we head into August and September, there's a sense that the market might just take a breather, consolidating its recent gains. Much of this future progress, we anticipate, will hinge on how Q3 earnings pan out – with expectations currently hovering around a robust 23% growth figure – and, crucially, what moves the Federal Reserve decides to make. Inflation, alas, remains a stubborn presence, exacerbated by oil prices climbing north of $90 a barrel, partly due to ongoing tensions with Iran. It’s a complex tapestry, to be sure.

Now, and this is truly important, please remember: the funds we've touched upon here, or indeed any CEF you stumble upon, are never, ever 'buy' recommendations right out of the gate. Think of this as your jumpstart, your initial research cue. CEFs, by their very nature, often come with higher volatility and can experience deeper drawdowns compared to the broader market. For these very valid reasons, they simply aren't suited for everyone. Your own due diligence is paramount; these are merely a shortlist to kickstart your own thorough investigation. Happy hunting for those high-income opportunities!