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Joe Eqcome  

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  • CEF Weekly Review: Cohen & Steers Quality Income Realty [View article]

    The Kayne Anderson price was NAV $26.44 for November 16, on XKYNX (

    The pricing fell from -1.4% and the NAV fell to -7.2% for a 5.8% updated.

    I was using the text that was generated. Your prices may have seen higher as a % changes.

    Nov 19, 2012. 10:42 AM | Likes Like |Link to Comment
  • CEF Weekly Review: Cornerstone Funds Stung By Articles In WSJ, Barron's [View article]

    Your last dividends payments cause the stock to goes down 4.5% YTD. That's 7.0% for the industry on average.

    Good luck!

    Nov 19, 2012. 10:04 AM | Likes Like |Link to Comment
  • CEF Weekly Review: Taiwan Fund [View article]
    Either my fault or the editors fault for not getting in the full text of what I entered.

    "Focus Stock(s) of the Week: Taiwan Fund ( is our best pick of the week. The annual dividend will likely be preceded in the month of December and be payable in January. The weekly share price was down 2.2% and the current NAV was up 1.0%. This will take the PrcNAVSprd down about 3.2% (normally good)."

    Alan Young, thank for having be back!

    The annual distribution level does not need a negative -$0.36. All that may be needed is a distribution level that is annual. There is no distribution level for which a -$0.36 level is mandatory.

    By the end of the December month we will see if the annual distribution is available.

    Joe Eqcome
    Nov 4, 2012. 06:03 PM | Likes Like |Link to Comment
  • Why Large Cap CEFs Are Significantly Undervalued: ADX, GDV, TY, And ZF [View article]

    I wouldn't disagree with your conclusion if you were focused on owning a package of taxable-debt oriented, leveraged CEFs.

    The proposition outlined in the article is more a play on movement of large cap equities which would respond differently in an environment of rising interest rates.

    The large cap CEF portfolio offered here might be an opportunity to add some diversification to your CEF holdings by augmenting it with an equity component.

    However, if you feel rates may never come down, PCEF is the one stop stock for participation in a leveraged taxable portfolio of CEFs.

    Jul 19, 2012. 05:07 PM | Likes Like |Link to Comment
  • ADX Vs. GUT: Fundamental Analysis Isn't Ideal For CEF Share Price Valuation [View article]

    Sales loads as you've indicated don't apply to CEF as they are publicly traded stock that are bought and sold on the stock exchange.

    To buy shares of a CEF you would have to have a brokerage account and commission for some of the on-line brokers are $10.00 or less per. So, this would not be a concern.

    They are all subject to management fee that are reasonable. Go to and you'll be able to find the expense ratio for each of the CEFs.

    I hope this is helpful.

    Jul 18, 2012. 06:57 PM | Likes Like |Link to Comment
  • ADX Vs. GUT: Fundamental Analysis Isn't Ideal For CEF Share Price Valuation [View article]

    The only dumb question is the one you don't ask.

    My sense of it is that since both are CEFs the likelihood that any of these barriers, to which you make reference, wouldn't likely have a meaningful impact.

    This may be a issue if one was a closed-end fund and the other was an ETF.

    I hope I've interpreted your question correctly. If not, try again

    Jul 12, 2012. 07:50 PM | Likes Like |Link to Comment
  • Why Large Cap CEFs Are Significantly Undervalued: ADX, GDV, TY, And ZF [View article]

    CEFs market segment is tiny and as a result is not on most peoples radar screens. So, this may be a investment "backwater" that receives less investors' attention.

    Approximately 2/3's of the $282 billion is considered fixed-income oriented. The balance equity oriented.

    The Eqcome CEF Index is 130 CEFs that have been in operation for an extended period of time and a second series of 58 that have been in continuous operations since the late 70's.

    Jul 12, 2012. 02:41 PM | Likes Like |Link to Comment
  • Why Large Cap CEFs Are Significantly Undervalued: ADX, GDV, TY, And ZF [View article]

    Let's take the example of a CEF that is trading at $10 per share and whose NAV is $10 per share (trading at par), it is paying an annualized $0.80 per share dividend and whose expense ratio is 1% on total net assets of $500 million.

    In this situation the metrics for are similar for both the market based valuation as it is relative to it NAV.

    Now, let's assume the stock is trading at a 10% discount. The stock price is now $9 per share vs $10 NAV per share. As you can see all the valuation on the stock market capitalization ratcheted higher than calculation based on NAV.

    The market value yield is 8.9% ($0.80 / 9.00) and the expense ratio is now 1.1%--although the dollar amount remains the same as expense ratios are typically based on NAV.

    I hope this is helpful.


    Jul 12, 2012. 02:27 PM | 1 Like Like |Link to Comment
  • Why Large Cap CEFs Are Significantly Undervalued: ADX, GDV, TY, And ZF [View article]
    David at Imperial Beach

    I agree with your first point that the days of large cap stocks owned in a CEFs are probably less efficient than owning them as an ETF or index fund.

    However, if investors thought large cap CEFs would change form to an ETF or liquidate, the likely investor response would be to narrow the discount as such a discount would be eliminated as in either case investors would get value of the NAV.

    We've seen this numerous times with smaller CEFs. The larger CEFs will not voluntarily convert for some of the reasons mentioned earlier in another comment.

    The catalyst for conversion is usually some investors forcing the conversion. However, given the size of the large cap CEFs, you'll need a lot of firepower to obtain enough stock to make your voice heard.

    Jul 11, 2012. 09:55 PM | Likes Like |Link to Comment
  • Why Large Cap CEFs Are Significantly Undervalued: ADX, GDV, TY, And ZF [View article]

    ADX does a meager buy- back program that it re-authorizes annually--more as eyewash than a serious attempt to repatriate value to shareholders.

    As far as converting to a ETF or mutual fund, the firm runs the risk of having assets dissipate as assets rise and fall with subscription and redemptions either as a mutual fund or an ETF.

    With a CEF your assets are fixed and you're saved from having investors pull them out. You charge the same fee based upon that fixed level of assets.


    Jul 11, 2012. 09:45 PM | Likes Like |Link to Comment
  • Maximizing Retirement Returns Through Social Security Elections [View instapost]
    a fat panda,

    Thank you for your comment and observations.

    Let me see if I can expand on my initial comments for the purpose of clarification.

    Point 1: Social Security Carries Risk. This is quite correct. However, this risk is moderate for current retirees compared to private pension fund assumptions of actuarial returns of 7.5% or greater understate their liabilities by $100's of billions.

    Given the choice between choice of opting for the GM retirement fund--or for that matter a state pension fund, versus Social Security, I'd choose the latter.

    Point 2: Social Security May Not Last Until 2033. This date represents the date in which full benefits may cease. As you're aware, S.S. in a "pay-go" system. S.S. benefits will not be eliminated but reduced to approximately 75% of full benefits. I dispute your linking Medicare and Social Security together as they represent two different sources of revenues. However, I'd entertain your logic for such a position.

    Point 3: "Don't Sell Outside Assets to Concentrate on Social Security": There is no implication that your non-S.S.retirement savings or portfolio management are mutually inclusive.

    What the article states is that without changing any of your retirement savings behavior, there are ways to maximizing Soc Sec benefits by planning carefully within the rules and regulations that guide such benefits.

    Even if Soc.Sec. reduces benefits it will likely be sometime in the late '2020's or early '2030's. Therefore odds for a reduction are fairly low in the next 10-to-15 years.

    Point 4: Your Benefits are Whatever Congress Says They Are: Any of the proposals to reduce S.S. benefits pretty much "grandfather's" in people over 55. The political will to take on seniors who have been paying into the system for 30 to 40 years would be suicidal.

    Having said all of that, your points are valid. However, the likelihood of a vast change in S.S.for the current group of seniors 60 and older is in our opinion remote.

    Therefore taking time to select your benefits in a valuable and profitable exercise.

    Jul 5, 2012. 04:29 PM | Likes Like |Link to Comment
  • CEF Weekly Review: IDE Goes Ex-Dividend Monday [View article]

    You'll find some excellent information on the issues that you raised at the following website:

    Jul 1, 2012. 10:47 PM | Likes Like |Link to Comment
  • CEF Weekly Review: Staying Alive [View article]

    The most important thing to consider when you're looking at return of capital distributions is those asset that generate non-cash charges such as depreciation, as in real estate, or depletion as in extraction industries such as oil, gas and timber (natural resources). So any of the CEFs that fall in those categories are prospects for return of capital distributions.

    You want to make sure that these are true non-cash charges by tracking the NAVs to make sure they don't decline with the return of capital distributions.

    The other issue with return of capital distributions is that it can be generate because of the timeing of income recognition.

    For example, in options, a position may have a gain that can't be recognized until the position is closed. Yet, in theory I can generate a distribution that is return of capital if the CEF prior to the closing of the position. (I must admit, I on dangerous ground with regards to option accounting--so proceed with care with some of the buy/write funds or dividend roll-over strategies.

    Again, check the NAV to see if it is deteriorating with return of capital distributions. That usually a good check

    A good source for this information is

    Jun 26, 2012. 05:32 PM | 1 Like Like |Link to Comment
  • CEF Weekly Review: Staying Alive [View article]

    I agree. I think an investment with a high return of capital that is generated from non-cash expenses, i.e., depreciation or depletion, which doesn't material impact invested capital makes sense in a taxable account.

    Because your heirs would get a "step-up" basis in the stock, should it become a bequest, the reduction in basis as a result of the return of capital distribution will unlikely get recaptured.


    Jun 24, 2012. 11:15 PM | Likes Like |Link to Comment
  • CEF Weekly Review: Staying Alive [View article]

    The simple answer to your question (remember "The Orient Express") is that SRV would be less attractive than other high yielding securities in a tax-exempt account due to the fact that SRV's distributions are mostly a return of capital and are typically not subject to income taxes at the time of distributions.

    Therefore, if you held it in a tax-exempt account such as an IRA you wouldn't be getting any advantage of the tax deferred nature on its distributions within that account.

    However, this quickly get complicated when considered in a Roth IRA because as a result of SRV's return of capital distribution lowering the cost basis of the stock, I'm not certain when you receive distributions from your Roth IRA if you would have to pay taxes on any recapture in the basis.

    If not, then it is a question of whether the benefits of compounding value of the lower tax basis is better than the loss from sheltering distribution from taxes from a return of capital distribution.

    These are important considerations beyond the scope of my expertise. If this is a meaningful investment decision I would consult a trusted financial advisor or your accountant.

    My knee-jerk reaction is to select something else for your Roth and own this in your taxable account.

    Jun 24, 2012. 12:33 PM | Likes Like |Link to Comment