Pioneer Closed-End Funds Required Notice to Shareholders Sources of Distribution Under Section 19(a)
- None.
- None.
Insights
The report detailing the sources of distribution for the Pioneer Municipal High Income Fund, Inc. (MHI) and Pioneer Municipal High Income Opportunities Fund, Inc. (MIO) provides insight into the funds' performance and financial health. A significant portion of the distributions for both MHI and MIO comes from Net Investment Income, which indicates that the funds are successfully generating income from their investments. The absence of Net Realized Short-Term and Long-Term Capital Gains suggests that the funds are not realizing significant profits from the sale of assets, which could be due to a strategy focused on income generation rather than capital appreciation.
For investors, the Return of Capital figures are particularly noteworthy. MHI has a higher percentage of its distribution coming from the return of capital, which could indicate that it is returning part of the investors' original investment back to them. This could be a sign of caution, as it may imply that the fund's income is not sufficient to cover the distributions, or it could be part of a strategic tax approach. On the other hand, MIO's lower return of capital suggests a stronger reliance on the income generated from its holdings.
Overall, the distributions' composition is essential for evaluating the sustainability of the payouts and the funds' investment strategies. Investors should consider these factors when assessing the attractiveness of these funds for income-focused portfolios.
From a tax perspective, the composition of distributions is an important factor for investors to consider. The fact that a significant percentage of the distributions is categorized as Net Investment Income may have favorable tax implications, especially for investors in higher tax brackets or those investing through tax-advantaged accounts. Tax-exempt funds like MHI and MIO typically invest in municipal bonds, which can offer tax-free income at the federal level and sometimes at the state level, depending on the investor's residency.
However, the portion of the distribution classified as Return of Capital is not taxed immediately as income. Instead, it reduces the investor's cost basis in the fund, which could result in higher capital gains taxes when the fund shares are sold. This is a critical aspect for investors to understand, as it could affect their long-term tax planning and the after-tax return on their investment.
Examining the distribution data for MHI and MIO against broader market trends can offer valuable context. The emphasis on Net Investment Income reflects a market environment where funds may prioritize steady income streams, which can be appealing during periods of volatility or uncertain capital growth prospects. This aligns with a conservative investment approach, which can be attractive to risk-averse investors or those seeking to preserve capital while receiving income.
The lack of capital gains distributions could also suggest that the funds are invested in securities with lower turnover, which often aligns with a buy-and-hold strategy. Such a strategy may be designed to minimize transaction costs and taxable events, potentially enhancing net returns for investors. The distribution data could also indicate how these funds are positioned in relation to market cycles and interest rate changes, which are important for municipal bond investments.
Distribution Period: |
March 2024 |
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Ticker |
Tax-Exempt Funds |
Distribution Amount Per Share |
MHI |
Pioneer Municipal High Income Fund, Inc. |
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MIO |
Pioneer Municipal High Income Opportunities Fund, Inc. |
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The following tables set forth estimates of the character of the current distribution and the cumulative distributions paid this fiscal year to date from the following sources: Net Investment Income; Net Realized Short-Term Capital Gains; Net Realized Long-Term Capital Gains or Return of Capital. All amounts are expressed per common share.
Pioneer Municipal High Income Fund, Inc. (NYSE: MHI) |
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Percentage |
Total |
Percentage Make up |
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Make up of |
Cumulative |
of Total Cumulative |
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Current |
Current |
Distributions |
Distributions |
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Distribution |
Distribution |
Fiscal Year to Date |
Fiscal Year to Date |
Net Investment Income |
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Net Realized Short-Term Capital Gains |
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Net Realized Long-Term Capital Gains |
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Return of Capital |
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Total per Common Share |
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Pioneer Municipal High Income Opportunities Fund, Inc. (NYSE: MIO) |
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Percentage |
Total |
Percentage Make up |
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Make up of |
Cumulative |
of Total Cumulative |
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Current |
Current |
Distributions |
Distributions |
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Distribution |
Distribution |
Fiscal Year to Date |
Fiscal Year to Date |
Net Investment Income |
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Net Realized Short-Term Capital Gains |
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Net Realized Long-Term Capital Gains |
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Return of Capital |
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Total per Common Share |
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Notes:
Investors should not necessarily draw any conclusions about the funds' investment performance from the amount of these distributions.
Each fund estimates that a portion of its distribution does not represent income or realized capital gains. Therefore, such portion of its distribution may be a return of capital. A return of capital may occur when some or all of the money invested in the fund is returned to the investor. A return of capital distribution does not necessarily reflect the fund's investment performance and should not be considered "yield" or "income."
The amounts and sources of distributions reported under the notice are only estimates and are not being provided for tax reporting purposes. The actual amounts and sources for tax reporting purposes will depend upon each fund's investment experience during the remainder of its respective fiscal year and may be subject to change based on tax regulations. Each fund will provide investors with a Form(s) 1099 for the calendar year that explains how to report these distributions for federal income tax purposes.
The funds are closed-end investment companies. The following funds trade on the New York Stock Exchange (NYSE) under the following symbols: MHI and MIO.
Keep in mind, distribution rates are not guaranteed. A fund’s distribution rate may be affected by numerous factors, including changes in actual or projected investment income, the level of undistributed net investment income, if any, and other factors. Closed-end funds, unlike open-end funds, are not continuously offered. Once issued, common shares of closed-end funds are bought and sold in the open market through a stock exchange and frequently trade at prices lower than their net asset value. Net Asset Value (NAV) is total assets less total liabilities divided by the number of common shares outstanding. For performance data on Amundi US’ closed-end funds, please call 800-225-6292 or visit our closed-end pricing page.
About Amundi US
Amundi US is the US business of Amundi, Europe’s largest asset manager by assets under management and ranked among the ten largest globally1.
With our financial and extra-financial research capabilities and long-standing commitment to responsible investment, Amundi is a key player in the asset management landscape. Amundi clients benefit from the expertise and advice of 5,5003 team members and market professionals in 35 countries3. A subsidiary of the Crédit Agricole group and listed on the
Amundi, a Trusted Partner, working every day in the interest of our clients and society
Follow us on linkedin.com/company/amundi-us/ and twitter.com/amundi_us.
1 Source: IPE “Top 500 Asset Managers” published in June 2023, based on assets under management as of December 31, 2022.
2
3 Amundi data as of 12/31/2023
Amundi Distributor US, Inc., Member SIPC
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Source: Amundi US
FAQ
What was the distribution amount per share for Pioneer Municipal High Income Fund, Inc. (MHI) in March 2024?
What percentage of the distribution for Pioneer Municipal High Income Fund, Inc. (MHI) came from Net Investment Income?
What percentage of the distribution for Pioneer Municipal High Income Fund, Inc. (MHI) came from Return of Capital?
What was the distribution amount per share for Pioneer Municipal High Income Opportunities Fund, Inc. (MIO) in March 2024?
What percentage of the distribution for Pioneer Municipal High Income Opportunities Fund, Inc. (MIO) came from Net Investment Income?
What percentage of the distribution for Pioneer Municipal High Income Opportunities Fund, Inc. (MIO) came from Return of Capital?
