Western Asset Diversified Income Fund (WDI)

Western Asset Diversified Income Fund (NYSE: WDI - Get Free Report)'s stock price traded down 1% during mid-day trading on Friday. The company traded as low as $14.13 and last traded at $14.1590. 192,822 shares traded hands during mid-day trading, a decline of 23% from the average session volume of 251,398 shares. The stock had

Western Asset Diversified Income Fund offers a 12.41% yield and trades at a -3.04% discount to NAV, with broad high-yield credit exposure. WDI's portfolio is diversified across sectors and issuers, but significant allocations to floating-rate and high-yield instruments introduce interest rate and credit risks. Potential Fed rate cuts in 2026 could pressure WDI's floating-rate holdings, while a stable or rising rate environment may benefit these assets.

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

Western Asset Diversified Income Fund offers a compelling 12% yield with a Buy rating maintained for its income and relative safety. WDI's portfolio is highly diversified across 420 holdings, primarily BB- and B-rated debt, with modest leverage and collateral-backed assets. The fund has consistently paid its monthly distribution of $0.1485 per share, even through tariff-related macro uncertainty.

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

NEW YORK--(BUSINESS WIRE)--Category: Distribution Related.

The Triple-Factor CEF Report screens over 400 funds for high yield (>6.5%), strong coverage (>90%), and discount to NAV, balancing yield, sustainability, and value. Top lists include funds with widest discounts, best z-scores, highest yields, and best combined metrics, offering potential for price appreciation and enhanced yields. Explore top lists for further research; these shortlists are not final buy/sell recommendations. Always verify coverage ratios with official fund documents.

Western Asset Diversified Income Fund offers an 11.8% yield, focusing on high-yield credit and monthly income for investors seeking stability amid market volatility. WDI's share price has declined, but total returns including distributions reached 8.4% over the past year; most returns are from income, not capital appreciation. The fund's aggressive leverage and high exposure to below-investment-grade credit add risk, especially in a high-rate environment, warranting caution.

Western Asset Diversified Income offers high current income via an actively managed, multi-sector credit portfolio, using leverage and dynamic asset allocation to capture diverse risk premiums. The fund's structural leverage amplifies both income and NAV volatility, with its performance highly sensitive to funding costs and credit market conditions. Key macro indicators—bank reserves, repo stress, and credit spreads—currently signal a stable environment, supporting the fund's pro-cyclical, credit-focused strategy.

WDI offers broad fixed income exposure and a high yield, but is heavily weighted toward non-investment-grade assets and uses leverage, increasing risk. The fund's current 11.84% yield is attractive, but coverage of distributions has weakened slightly year over year. WDI has outperformed its category in 2025, but trades at a small premium to NAV, above its historical average discount, reducing its value proposition.

Ongoing market volatility may not surprise investors — but the potential of a multi-sector bond strategy to deliver reliable income might. WDI focuses on delivering high, consistent income by dynamically allocating across diverse fixed income sectors. Discover how a dynamic credit allocation can help investors manage risk and stay resilient from Mike Buchanan, Chief Investment Officer at Western Asset Management.

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

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

The tech-heavy Nasdaq started to dip toward the end of February, but a strong last trading day of the month rally clawed back some of those losses. The equal-weighted S&P 500, as measured by the Invesco ETF RSP, held up reasonably well thanks to the value sectors putting up some better performance. Every month, I put some cash to work to grow my CEF portfolio income, though I've been allowing my cash pile to also grow over the last year or so.

I am downgrading my rating on WDI due to the Fed's hawkish stance, prolonging the high interest rate environment. WDI's portfolio, heavily weighted in below investment grade credit, is sensitive to rising costs of debt and potential defaults, impacting net investment income. The fund's NAV discount has shrunk, reducing its attractiveness. The dividend yield remains high but may not be fully supported by net investment income.

Every month I add to my income-focused CEF portfolio, which creates a snowball and compounds growing cash flow over time. With some greater volatility opening up in the broader market, that helped to provide some select opportunities in what appears to be an otherwise still pretty pricey market. While no one knows what the future holds for sure, I'm still holding on to a sizeable cash position that I'd look to deploy in a broader market correction.