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  • Buy India Before The Herd [View article]
    "The ETF we like best for capturing India's growth is the Market Vectors India Small Cap." - This fund appears to be the total loser during almost any time frame, regardless if up or down market:
    Can you explain how this small cap, cap weighted index fund manages to underperform even the Indian small cap indices by orders of magnitude? The currency doesn't explain it if you overlay it on the chart
    May 22, 2015. 04:03 AM | Likes Like |Link to Comment
  • A Quick Overview Of UBS ETRACS 2X Leveraged ETNs [View article]
    3832814, how do you get $5 trades at TDA? Their online commissions are $9.99. Is this a grandfathered account?
    May 19, 2015. 05:37 PM | Likes Like |Link to Comment
  • South Korea Valuations Close To 2009 Levels [View article]
    Are you trying to make an investment case largely on one valuation metric (P/S)? Was this metric cherry picked? Not very convincing to me.
    May 19, 2015. 02:59 PM | Likes Like |Link to Comment
  • South Korea: Home Of The World's Best Equity Opportunities [View article]
    "after valuation, I focus my attention on economic freedom - the rule of law, limited government, regulatory efficiency, and open markets." - Do you have any evidence that corruption, transparency, open markets, common law, etc., correlate with equity returns, or is it just what you "believe" or what "would make sense" to you? I cannot find any evidence in your article. What seems intuitive, often does not stand rigorous testing. It is conceivable that corruption, transparency, etc., are already priced into current valuations. It is also conceivable that a change in future expected corruption, transparency, etc., correlates with equity returns, rather than the current level of corruption etc. - similar to how changes to growth expectations correlate with equity returns. The article cites no hard facts, metrics, or evidence that the proposed asset allocation and country selection is based on.
    May 19, 2015. 04:25 AM | 1 Like Like |Link to Comment
  • Jardine Matheson Is A Great Way To Invest In Asia [View article]
    Do you have any rational basis for your statements, or is it just what you "believe" after reading the companies' shareholder "propaganda" publications? The complex, majority controlled, holding structures exist for a reason, and it is obviously not shareholder value, as evidenced by the steep discounts. Those holding structures are in essence vehicles to hold captive capital of minority shareholders, similar to mutual funds in disguise, with no way to get the capital out. They carry corporate expenses (fees) and are leveraged to give the illusion to add value. Rigorous studies have shown that over long time periods, Asian holding companies have underperformed the market. Sorry to question your belief system based on facts.
    May 18, 2015. 11:28 PM | Likes Like |Link to Comment
  • Equity CEFs: How To Buy The Dow Jones Industrial Average At A 10% Discount And A 6.9% Yield [View article]
    "But then nobody, especially me, has called CEF investors very smart..." - I think the investors that drove prices down and discounts up were smarter than the author may realize (no offense!). There is no rational argument that I know of why an investor should "overpay" based on historic or recent performance of the asset class, let alone that of a particular product. There are good rational no-arbitrage arguments based on the distribution yields and expense ratios, however, why the current discounts of ca. -10% are not even enough to compensate for the idiosyncratic risk that comes with these retail products.
    May 18, 2015. 08:16 PM | Likes Like |Link to Comment
  • Time To Invest Strongly In The Korean Equity Market [View article]
    Why do you invest in the ordinary shares rather than the preferred shares that are available for most of the securities in your portfolio? Also, what is the difference between the various preferred share classes of Sungshin Cement?
    May 18, 2015. 06:46 AM | Likes Like |Link to Comment
  • South Korea: Home Of The World's Best Equity Opportunities [View article]
    I'm not disputing your statement as I'm not good at interpreting P&L statements or balance sheets. But wouldn't all those investments eventually show up on the P&L statements in the form of depreciation? I know often times in capital intensive businesses, the tax depreciation is even faster then actual depreciation, when assets outlive their depreciation schedules. On average over the years, in the long run, it would even out, and all expenses must eventually show up on the earnings statements, right?
    May 15, 2015. 02:29 AM | Likes Like |Link to Comment
  • A Tax Exempt CEF Portfolio Generating Over 5% Income [View article]
    Respectfully, I believe the author's performance and risk measurements are largely meaningless (no offense):
    - The leveraged CEFs benefited from the decrease in interest rates over the last few years. They currently borrow at close to 0%, and the leveraged assets were revalued due to depressed interest rates, providing the CEFs with a huge spread between borrowing rates and return on assets. Even WITHOUT future interest rates increase, this was a one-time effect, or limited in duration, with mathematical likelihood of 100%. Any comparison to unleveraged ETFs etc. based on the past few years' performance is skewed, and has little to no predictive value.
    - Volatility has little meaning as a risk measure for most purposes.
    - While the CEF's distributions may not include any ROC, they may - and most likely will - include relatively large realized gains on bonds sold by the funds, due to the decrease in interest rates over the past few years, right? If that is the case, then the distributions - while not ROC from an accounting perspective - would in part decrease the funds' NAV. I believe the expected return from bond CEFs is significantly lower than the current distribution. I was unable to find accurate information on the portfolios' average current yield to maturity (IMHO a better predictor of future returns), or on the accounting principles of municipal CEFs. If anyone has more information, I'd be happy to hear about it.
    May 5, 2015. 04:22 PM | 1 Like Like |Link to Comment
  • A Quick Overview Of UBS ETRACS 2X Leveraged ETNs [View article]
    "this is the cheapest leverage they can get" - except with index futures you can get far cheaper leverage and zero management fee. Thus anybody who has an allocation to the S&P500 in their portfolio is better off with futures and low-expense, non-leveraged products.
    Mar 21, 2015. 01:33 PM | 3 Likes Like |Link to Comment
  • Municipal Bonds Closed End Funds - How To Find The Best Values [View article]
    The article appears to imply (just like many others in this forum) that municipal bond CEFs will have returns in the high single digits ("Their tax equivalent yield is high reaching over 10%"). I personally think this is misleading. The current distribution yields have absolutely nothing to do (that I can see) with expected returns. Distribution yields may - and I assume almost certainly will - include significant capital gains resulting from the past drop in interest rates. If I'm not mistaken, current municipal bond yields to maturity are in the 2.x percent range for investment grade bonds. Even with leverage and assuming that long-term interest rates stay low, I have a hard time seeing how returns could be anywhere close to the current distribution yields of 6.x% that some funds currently "yield". I think a more meaningful number would be the weighted average SEC yield of the bonds in a fund. Unfortunately though I can't find these numbers published for most CEFs. I'm not an expert on municipal CEF distribution policies or accounting, so please correct me if I'm wrong.
    Example: Vanguard Long-Term Tax-Exempt Fund (VWLTX) has currently an average portfolio coupon of 4.6%, and a portfolio yield to maturity of 2.4%, and a SEC yield of 2.13%. And that is for long-term municipal bonds, mostly AA not even AAA; the numbers are certainly lower for shorter durations. I would be curious if somebody can explain me which magic CEFs use to turn those 2.x% numbers into 6.x% returns. I think they won't; not even close. I think looking at distribution yields is arguably completely useless, and at best highly misleading.
    On another note, the effect on yields or returns from realized "discounts to NAV" (via distributions at NAV) is more than eaten up by the expense ratios, for almost all CEFs that I checked.
    Mar 5, 2015. 07:59 PM | 1 Like Like |Link to Comment
  • Arbitraging 20% As An Exuberant Closed End Fund Returns To Normalcy [View article]
    What makes you believe that the full correction to the average discount occurs within a year? Markets often stay irrational longer than you can stay liquid, especially CEFs. Many CEFs had huge premiums for years just because they returned investors' own capital, completely irrational. Betting on other investors' common sense while being short with a 24% borrow rate plus margin cost seems like a risky game to me.
    Jan 20, 2015. 03:53 AM | Likes Like |Link to Comment
  • Pargesa: Buy Premium Assets At Multiple Discounts [View article]
    An important question: What is the "money leakage" (holding company overhead / carrying cost) at GBL? What is the money leakage at Pargesa? Only with that information can we decide if the discount represents tangible value, or which of the two companies is the better option.
    Jan 7, 2015. 01:19 AM | Likes Like |Link to Comment
  • 10.6% Yielding ETW Offers Both Income And A Capital Appreciation Opportunity [View article]
    How can that make somebody feel good??? The fund annihilates ca. 2% of invested capital annually in fees alone. 2% of whatever is invested in stocks or cash, regardless of investment performance. Have you calculated the present value of this annihilation? Coincidentally, the current discount is among the smallest in its history. I don't see how anybody can believe the discount may further narrow, and even if it does, compensate for the carrying cost of annihilation between now and then.
    Jan 5, 2015. 08:56 PM | 1 Like Like |Link to Comment
  • 10.6% Yielding ETW Offers Both Income And A Capital Appreciation Opportunity [View article]
    Two questions:
    - Do distribution yields of CEFs have any meaning in terms of risk or return of the underlying portfolio? CEF distributions are just arbitrary numbers, and can come from dividend earnings, past or current capital gains, or from nothing at all, right? Why would any reasonable person even bother looking at distribution yield numbers?
    - Is there any evidence of a buy-write strategy outperforming an index investment on a risk-adjusted basis (CAPM)? If yes, can you cite a reference? thanks!
    Jan 2, 2015. 06:09 PM | 1 Like Like |Link to Comment