Recently, two CEFs (AOD & AGD) from Alpine were forced to cut dividends by a large margin. Those of you counting on the income may be somewhat shaken by the news, but I think it will be for the best. The methods they use for income revolve around rotating holdings based on dividend payments. With recent cuts or reductions by the companies they hold they were forced to employ some leverage and churn holdings at a rate of nearly 650% annually. I think that with the reductions they will churn less and reduce leverage. I believe that the end result will be a full recovery of these CEFs over the next year or so as the general economy worldwide improves. I would expect the monthly payouts to remain the same into the 2nd quarter of 2011 and then get a slight increase.
The third Alpine CEF, AWP, reduced dividends a while back and has been doing fairly well since. It has also raised its dividend once since the initial cut. Not too bad for a fund that is essentially a REIT.
Also keep in mind that all three pay out any unpaid income at the end of the year.