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Dan Plettner

 
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  • Short-Selling PIMCO Global Stocks Plus and Allianz's Inconsistent Distribution Policy [View article]
    I today received privately a query/comment stimulating high level discussion about the comparison between NFJ and PGP. Having respect for, but no business relationship with the other party, I found myself unable to respond to them directly in spite of my respect for them. They are more than welcome to discuss the topic with me here, publicly where I do not have to be concerned with holding myself out as an Investment Advisor to them. (I am not a Registered Investment Advisor).

    In short, the query observed the different securities between PGP and NFJ, and stimulated specific discussion of the difference between portfolio composition and mechanics in contrast to the product(s) investing purpose. Whether mechanically selling equity calls or in substance generally relinquishing some of the Fund NAV’s broad market upside to generate distributable revenue (generally managed, but tax-advantaged Return of Capital “ROC”), the funds are substantially marketing to suit the same investor purpose, in my opinion.

    I do not question whether the choice of mechanics between PGP and NFJ’s approaches are different. Rather, I have observed that within the type of product purpose the Distribution Governance within the same Governance umbrella is hugely different. Despite sharing the same performance profile, and similar performance prospects based on effectively sacrificing and achieving similar upside/downside, and serving similar purpose, NFJ’s distribution governance has chosen to make it among the lowest yielders among the group. PGP’s distribution governance has (in my opinion) chosen to make it a peer of the Cornerstone Funds in terms of distribution management (effectively, slow, self-liquidation).

    Also, I would expect that it is to Allianz' benefit that it focuses on the differentiation between mechanics rather than the similarity in profile and purpose. Their open-end fund marketing may enjoy a benefit of maintaining the perceived value associated with a sibling Closed-End trading at a premium.

    My perspective should not be assumed to be the broad understanding of these funds. In fact, I don’t think it is. Also, to be clear, Allianz refused discussion on these topics so I am not speaking on their behalf as to the purpose either of these funds serve. I also am not a regulator, judge, or jury. I offer no conclusions about Allianz' business tactics. All I can speak to is my understanding of their purpose based on my experience in the CEF space.

    There appear to be several adjacent topics to this piece, which SA published as an “Investment View”. Perhaps there are more than one follow up contributions to write here, one discussing potential catalysts, one discussing the difference between a fund’s mechanics and general profile.

    Dan Plettner
    Nov 22 01:18 PM | 1 Like Like |Link to Comment
  • Fiduciary / Claymore MLP Opportunity Fund: A Hazardous Mean Reversion Candidate [View article]
    Although the compliments are never necessary, thank you for the kind words, Ron. Whatever the subject, I contemplate your appraisals very seriously because I respect your work and voice.

    Although Ron is far more accepting of the inefficiencies with the MLP focused ETNs than I am, Ron's observations on the ETF "AMLP" are among the best work that I've read on Seeking Alpha.

    Broadly, I think there is much merit to Ron's contributions. I respect his voice, process, and observations. Below, are links to two of Ron's pieces on AMLP worth particular observation. Both were also recognized by SA editorial and published as "Investment Views":

    seekingalpha.com/artic...

    seekingalpha.com/artic...

    Respectfully Yours,
    Dan Plettner
    Nov 22 09:52 AM | 3 Likes Like |Link to Comment
  • Short-Selling PIMCO Global Stocks Plus and Allianz's Inconsistent Distribution Policy [View article]
    Dear Frogmatic:

    Thanks for your well merited comment. The relevance inherent to your question is not lost on me.

    Given the complexity of the observations here, I’ve decided to consider writing about catalysts in follow up coverage. Please know that how and when I offer my observations and perspectives is my choice. I am not in Seeking Alpha’s employ. I do respect “Frogmatic” for bringing up the deficiency; clearly it would be a deficiency for anyone who is unfamiliar with catalysts to act aggressively on the notion of a silly unjustified valuation.

    To other readers, “Frogmatic” makes a great point. In the absence of understanding or anticipating the probability of catalyst(s), it is generally dangerous to speculate against anything, especially a fund where the valuation facts should be considered well observed.

    Respectfully Yours,
    Dan Plettner
    Nov 22 09:42 AM | 2 Likes Like |Link to Comment
  • Short-Selling PIMCO Global Stocks Plus and Allianz's Inconsistent Distribution Policy [View article]
    Dear "Mike T"

    I am sorry that my comment to “rheimerl” did not provide you with a current short thesis on AOD in my name, to which it would appear you feel entitled. With respect, I am not going to be demonstrating my current thesis on AOD in the comments of an article about PGP. AOD was discussed merely in context here.

    As I said before, my position in AOD is disclosed because AOD is discussed in the context of this article. Since SA published a June 22 “Investment View” on AOD, I closed a position and opened a new position. I do recognize that I my current in depth perspective of each of the Alpine Funds is not readily available to the SA community. As time allows, I am interested to provide my current in depth perspective on all the Alpine Funds in detail consistent with my own content standards. That will not be in an article comment in an alternate SA “Investment View.”

    Best wishes to “Mike T” and to all who have long positions in any of the securities in which I’m short. I’ll do what I believe to be objective in spite of my kind regards to those with alternate perspectives to my own. As “Mike T” alluded, its “Mr. Markets” judgment matters, not mine.

    Respectfully Yours,
    Dan Plettner
    Nov 21 09:40 PM | 1 Like Like |Link to Comment
  • Energy Income and Growth Fund: Long Term Qualitative Observations of C-Corporation MLP Vehicle Suggests 'Dip' Perception Is Illusory [View article]
    Dear "Skyraider"

    Perhaps the better question to ask is why someone who is subject to significant dividend taxes in their taxable accounts would consider MLP asset class exposure in their IRAs at all. It would be comparable to holding dividend stocks in a taxable account and municipal bonds in an IRA. In short, the IRA is wasteful of the unique tax advantages afforded by either asset class.

    Congress seems to have made the MLP advantage for taxable accounts exist for much the same reason that it gave states and cities a funding advantage with municipal bonds’ federal taxation advantage… the origin of MLP tax advantages gave domestic energy infrastructure companies an advantage in attracting investment.

    I’m not in any way disputing that more than small holdings in IRAs can pose problems, but such a discussion about significantly sized IRA MLP exposure is is akin to arguing between dumb and dumber… MLP exposure in IRA accounts is inefficient asset allocation on an after tax basis, much like Muni Bond exposure in IRA accounts. For the investor that has significant taxable wealth, why waste the MLP’s advantage by using IRA capital?

    Respectfully Yours,
    Dan Plettner
    Nov 21 09:23 PM | Likes Like |Link to Comment
  • Energy Income and Growth Fund: Long Term Qualitative Observations of C-Corporation MLP Vehicle Suggests 'Dip' Perception Is Illusory [View article]
    Retail or otherwise, there is nothing efficient about proportional performance. Wall Street loves to knock on the K-1 forms associated with more efficient ownership because the inefficient C-Corporation entity bundles better serve their asset gathering business models.

    It is troubling how little respect someone displays for their wealth when they choose inefficient products in the name of convenience. Its more troubling that the asset management industry markets to such a manner of thinking.

    Respectfully Yours,
    Dan Plettner
    Nov 21 09:07 PM | 2 Likes Like |Link to Comment
  • Short-Selling PIMCO Global Stocks Plus and Allianz's Inconsistent Distribution Policy [View article]
    Dear “rheimerl”

    Please know that the primary subject of this piece is not AOD. It was also published by SA as an "Investment View" on PGP, not AOD.

    My position in AOD is disclosed because AOD is discussed in the context of this article. Please notice though that I have not offered a thesis to support my current position in AOD. The last SA “Investment View” publishing of my AOD subject material was dated June 22nd. Since that time, I closed a position and opened a new position.

    Simple observations should be assumed well recognized by all market participants. Differences in the depth of observations may or may not be indicative of the difference between Seeking Alpha’s “articles” and “investment views”. I do recognize that I my current in depth perspective of each of the Alpine Funds is not readily available to the SA community. As time allows, I am interested to provide my current in depth perspective on all the Alpine Funds in detail consistent with my own content standards. If and when I am able to do so, I have no prior knowledge whether SA will deem it appropriate to publish as an Investment View or an article.

    I have no control or influence over SA editorial. SA’s editorial assessments are always their own, not mine. In fact, I occasionally take exception to the standard CEF content that gets published as “articles”. Frankly, some CEF recommendations that get published as “articles” may put the reader in market jeopardy with insufficiently detailed looks at intricate and nuanced CEFs, in my view.

    Respectfully Yours,
    Dan Plettner
    Nov 21 10:41 AM | 2 Likes Like |Link to Comment
  • Observing Claymore's Dividend & Income Fund Among Narrow Closed-End Fund Calls [View article]
    I am not above critique and gave this comment the benefit of any doubt. Without commenting on PMCPman's data, yes, I continue to believe activism is "over here", for many years. The January in-kind tender's fulfillment rate is not without relevance.

    Respectfully Yours,
    Dan Plettner
    Nov 20 03:55 PM | Likes Like |Link to Comment
  • Alerian MLP ETF Has Higher Fee Structure Than Hedge Funds [View article]
    Agree with Ron.. not that "expense" is the accurate technical legal term so much as the practical reality. Remember that a prospectus is written by lawyers not a retail investor. Not sure if "chileman" is attempting to suggesting by "quite clear" that he thinks its "quite clear" to a normal person to the extent that Ron's real person dialogue would offer. But, if that is what "chileman" is suggesting, I respectfully disagree.

    Was speaking today to the editor of the mutualfundreform blog. I think this issue is one that will increasingly become of greater interest to the mainstream media. There is no shortage of documentation of the effect that the C-Corporation structure has on the NAV performance of MLP investing products.

    Respectfully Yours,
    Dan Plettner
    Nov 18 03:19 PM | 1 Like Like |Link to Comment
  • Attractive Entry Points for Closed-End Funds FMO and ETJ [View article]
    This is not the first time Joe Ecqome has revisted my work, whether intentional or not, without citation. It would seem apparent to me that if SA has published a revisiting of my work, however inferior in depth and competency, however poorly bundled with an incompetent recommendation of FMO that the author won't respond to comment critique of, and however different in style, a mere citation of my work would be appropriate.

    Respectfully Yours,
    Dan Plettner
    Nov 16 03:30 PM | Likes Like |Link to Comment
  • Alerian MLP ETF Has Higher Fee Structure Than Hedge Funds [View article]
    Although both versions of the title are figurative, I think the point is clear. The "cost" of the single security wrapper products is horrific.
    Nov 16 02:11 PM | 1 Like Like |Link to Comment
  • Alerian MLP ETF Has Higher Fee Structure Than Hedge Funds [View article]
    Dear Chileman

    Choosing IRA accounts to make MLP asset class allocations does waste the MLP asset classes unique advantage: a perpetual interest free loan from Uncle Sam for a significant portion of the yield.

    Its ironic... the very reason that MLPs are desirable (the perpetual interest free loan enabled by those K-1) is the very thing the asset management industry is telling the public they need to avoid.

    Simple truth is that Mutual Funds, Closed-End Funds, ETFs, and ETNs are significantly inefficient for MLP exposure, in different ways.

    Respectfully Yours,
    Dan Plettner
    Nov 16 02:09 PM | 1 Like Like |Link to Comment
  • Municipal Debt Funds: Are These Yields Unsustainable? [View article]
    There are "so many" funds because the business model for the Advisors is to increase Assets Under Management ("AUM"). Such a business interest (of the fund's sponsors, not shareholders) is served when each new deal is priced. Closed-End Fund IPO's are priced at premiums, and in many cases (ie: CEFs investing in MLPs are C-Corporations and share an awful long term upside NAV inefficiency with AMLP, the ETF) there are reasons the market should value many at a discount from day 1, even beyond the possibility that their Boards treat the AUM as captive.

    The marketplace for Closed-End Funds is tremendously inefficient in my humble view, and likely always will be. What got published here is sadly symptomatic of the level of what passes as "research". Truely researching Closed-End Funds requires more attention to detail and appreciation for various market dynamics than ETFs or open-ends. But often they find themselves owned by people, and worse covered by so called experts who apply the same simplistic vantage points.

    I'm not complaining. I love Closed-End Funds and I love the prospect of market inefficiencies. For the record, I have both long and short positions in Closed-End Muni Funds. It is also appropriate that I disclose my trading decisions are licensed as data to a Registered Investment Advisor, which I am not.

    Respectfully Yours
    Dan Plettner
    Nov 15 01:47 PM | Likes Like |Link to Comment
  • Municipal Debt Funds: Are These Yields Unsustainable? [View article]
    As "das555" said, caution in aggregating all funds together is appropriate. The one of the funds Karl mentioned that interests me on either the long or short side as potentially inefficiently priced has data that is quite contrary to the author's implied conclusions. Of course, the names of all funds weren't even correct. Sadly, its hard for Seeking Alpha to really evaluate the quality of CEF content before publishing. More sadly, few experts display the tendency for calling out contributors on (de)merits of their "contributions".

    Respectfully Yours
    Dan Plettner
    Nov 14 12:12 PM | 1 Like Like |Link to Comment
  • Municipal Debt Funds: Are These Yields Unsustainable? [View article]
    Hammer

    Essentially, I observed whether the author’s conclusion was or was not viably constructed in my view. Lots of people who are very smart market people have not taken the time to really appreciate some of the nuances of Closed-End Funds. Closed-End Funds are underappreciated and underfollowed. In short, there may be inefficiencies to exploit when you are seeing relevant details others aren’t seeing. If you think this piece observed more (and not less) of the relevant information about this group than average market participants are mindful of, then it would seem you have something actionable…

    Don't take this for more than it is but I agree with the author’s simple observation that the style has been in vogue and gone up.

    But, the piece does not discuss “why” beyond broad taste for the asset class. There is far more to the story. To understand the upside and downside risks it’s important to know a lot more than what the author here put on his plate.

    Respectfully Yours,
    Dan Plettner
    Nov 13 03:25 PM | 1 Like Like |Link to Comment
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