Company: FOF
Filing Date: 2025-03-07
Form Type: N-CSR
Source: 0001193125-25-049815
Chunk: 2

Company: Cohen & Steers Closed-End Opportunity Fund, Inc.
Filing Date: 2025-03-07
Form: N-CSR
Chunk 2
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’s expense ratio. In addition, in order to make these distributions, the Fund may have to sell portfolio securities at a less than opportune time.

Shareholders should not draw any conclusions about the Fund’s investment performance from the amount of these distributions or from the terms of the Fund’s Plan. The Fund’s total return based on NAV is presented in the table above as well as in the Financial Highlights table.

The Plan provides that the Board may amend or terminate the Plan at any time without prior notice to Fund shareholders; however, at this time, there are no reasonably foreseeable circumstances that might cause the termination. The termination of the Plan could have the effect of creating a trading discount (if the Fund’s stock is trading at or above NAV) or widening an existing trading discount.

Market Review

Closed-end funds moved higher across the board in 2024, posting double-digit returns in what was a strong year for capital markets generally. Economic growth exceeded expectations throughout the year, and inflation trended lower in the first half before stabilizing in the 2.5–3% range.

The Federal Reserve reduced its benchmark lending rate three times in the second half, but healthy economic growth and stubborn inflation sharply reduced investor expectations for additional rate cuts in 2025.

In this environment, U.S. equity returns exceeded 20% for a second consecutive year. Bond yields were volatile, with the 10-year U.S. Treasury rising from around 3.9% to settle close to 4.6%, near its highs for the year. However, narrowing credit spreads supported fixed income investments in many credit sensitive sectors.

Discounts to net asset value (NAV) for the three major fund categories—equity, taxable fixed income, and tax-free municipal bonds either narrowed or traded to a premium in the year. In addition to the gains in underlying asset values, the closed-end fund market was supported by a lack of new issuance.

High-profile activism encouraging closed-end funds to open-end, liquidate, or merge spurred distribution increases, tender offers and overall boosted the appeal of the remaining funds. The primary market for closed-end funds remained closed during the year, with little desire for new offerings as investor sentiment favored more seasoned issues.

Fund Performance

The Fund had a positive total return in the year and outperformed its benchmark on both a NAV and market price basis. At the highest level, our overweight allocation to equity, funded by underweights to taxable fixed income and municipal bond funds all added to relative performance in the year. Our fund selection within equity