The Virtus Equity & Convertible Income Fund (NIE) is experiencing downward pressure amid a broader market environment characterized by significant volatility and investor caution. The Dow Jones Industrial Average is on the brink of a historic 10-day losing streak, a situation not seen since 1974, as the Federal Reserve's recent decision to cut interest rates by a quarter point has disappointed market expectations. The Fed's indication of fewer rate cuts in 2025 than previously anticipated has led to a surge in bond yields, further unsettling equity markets. This environment has particularly impacted sectors sensitive to interest rate changes, including those tracked by the NIE ETF.
Additionally, the current market climate is ripe for tax-loss selling, a strategy that investors might be employing as the year draws to a close. Despite a robust 25% gain in the U.S. market year-to-date, certain segments, such as long-term bond funds and individual stocks, have underperformed, presenting opportunities for investors to realize tax losses. This could be contributing to the selling pressure on funds like NIE, as investors seek to offset gains elsewhere in their portfolios.
The NIE ETF is currently priced at $24.16, reflecting a 0.62% decrease from its previous close.