grinninbrit71

Cohen & Steers: CEF 'Spring-Loaded' in Market Recovery

this is a crazy article... its a good spring-loaded vehicle for a market recovery because even at a 6% premium, it "effectively" trades at a discount because its components trade at a discount.

well yeah, thats true... but then again just buying the components saves you the 6% overpayment and the annual management fee's of the fund (which of course the investor has to absorb in addition to the large management fee's that component CEF's often charge too.)

go find its top 10 holdings and buy those yourself, forget the vehicle holding them selling at a premium... unless of course this vehicle moves to a nice 10-20% discount while at the same time the components are at reasonable discounts of 10-20%

also remember that while discounts now are very large compared to the prem/discount landscape of the last 10-15 years.... you need to throw the last 10-15 years out !!!! these are junk bubble years. CEF's have been around since the great depression. go back and look at the long history excluding the wacko 90's-00's. 10-20% discounts are the norm.

so now that the components are at 10-20% discounts, assume that to be "par". so if you really want a "parent" holding of these funds, and that parent wants to charge you 1% a year management fees, perhaps a 10% discount of FOF would make it a reasonable buy. That would then make this article more spot-on.