HIO: Struggling To Cover The Distribution And Potentially Limited Upside

Western Asset High Income Opportunity Fund Inc. offers an 11.24% yield, outperforming major bond indices but trailing some closed-end fund peers. HIO's net asset value has declined consistently, raising concerns about distribution sustainability as it fails to fully cover payouts with investment income. Recent market events and Fed rate cuts have pressured HIO's income, especially from its floating-rate assets, and further cuts may worsen this trend.

Seeking Alpha • Nov 18, 2025

High-Yield Closed-End Funds (Part 4): HIO

HIO is a high-yield, diversified closed-end fund trading near its lowest valuation in the past year, offering attractive entry for value-seeking investors. The fund boasts a moderate BB credit rating, no leverage, and a 10.47% distribution rate on NAV, making it suitable for conservative, income-focused portfolios. HIO's historical total returns have consistently outperformed HYG, even when HYG is leveraged, underscoring its strong long-term performance.

Seeking Alpha • Aug 16, 2025

Western Asset High Income Opportunity Fund Inc. Announces Financial Position as of June 30, 2025

NEW YORK--(BUSINESS WIRE)--Category: Financials.

Business Wire • Aug 13, 2025

HIO: Limited Appeal Due To Poor NAV Growth And Weak Dividend Coverage

I rate HIO a sell due to weak underlying performance, poor NAV growth, and inconsistent distribution coverage in the current high interest rate environment. HIO offers an attractive 11% yield, but its focus on high-yield, below-investment-grade debt increases risk and makes distributions vulnerable to cuts. The fund's persistent NAV decline and frequent net realized losses raise concerns about long-term capital preservation and sustainability of payouts.

Seeking Alpha • Jun 6, 2025

Western Asset High Income Opportunity Fund Inc. Announces Results of Annual Meeting of Stockholders

NEW YORK--(BUSINESS WIRE)--Category: Fund Announcement.

Business Wire • Apr 17, 2025

HIO: Junk Bond Focus Better Than Floaters For Rate Cuts

The Western Asset High Income Opportunity Fund offers a competitive 10.52% yield, outperforming major fixed-income indices and appealing to income-focused investors. Despite problems in the bond market, the fund's performance has been strong, with a 7.93% total return over the past six months. The fund is focused on investing in junk bonds instead of floating-rate securities, which is a better place to be in the current rate environment.

Seeking Alpha • Mar 22, 2025

How To Get 11% Dividends And Wealth Protection In 2025

As I write this, the S&P 500 is sitting on a 28% total return for 2024. And of course, that could shoot even higher if we get the traditional Santa Claus rally.

Forbes • Dec 21, 2024

HIO: High-Yield CEF With International Exposure

HIO is a well-diversified fixed income CEF with over 250 holdings, mainly in U.S. high-yield bonds, and minimal currency risk. The fund has shown robust returns, outperforming unleveraged peers, but lags over a longer time frame and has wider drawdowns. Current tight credit spreads suggest caution; consider lightening exposure and re-entering after a 10% price drop.

Seeking Alpha • Nov 26, 2024

HIO: Limited Protection Against A Resurgence Of Inflation And Limited Upside Potential

The Western Asset High Income Opportunity Fund offers a high yield of 10.76%, outperforming peers but with potential risks due to inflation. The fund primarily invests in junk bonds, but has the potential to invest in common stocks. It is not currently exercising this option. Bonds may not provide sufficient protection against a resurgence of inflation, which is quite possible once the Fed cuts rates.

Seeking Alpha • Sep 6, 2024

These Huge Dividends Are (Still) Cheap After The August 5 Crash

Think back just a couple weeks: The “yen carry trade” had investors running scared, and we had a terrific opportunity to buy stocks—better still our favorite income plays on stocks: closed-end funds (CEFs) yielding 8%+.

Forbes • Sep 1, 2024