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JComar

JComar
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  • Equity CEFs: How To Play The Allianz Funds Right Now [View article]
    I'm not Doug, but I'll take a crack at responding, since this is something that's occurred to me, too. I don't see any reason to avoid high-ROC funds in a retirement account. True, the tax advantage goes to waste, but the retirement account already has a tax advantage. It's no worse than having any other type of fund there. High ROC is a bonus you get in a taxable account rather than a loss you take in a retirement account. I have CEFs with high ROC in my IRA--because they're good funds. Needless to say, if there are funds with low ROC that you want to own, it would be preferable to have them in your IRA and high-ROC funds in your taxable account, but you don't actually lose anything by having the latter in an IRA.
    Oct 1, 2013. 09:31 AM | 1 Like Like |Link to Comment
  • Equity CEFs: Terrific Opportunity In A Duff & Phelps Utility Fund [View article]
    I can understand that it's better to buy at a discount than a premium, but it seems this would really be of tangible value only if the fund is liquidated? In your earlier article today, you advise buying at a discount and selling at a premium, but isn't it also possible to lose money that way? If the NAV and market price decline while you're holding it, the market price may be above the NAV (producing a premium) but still lower than when you bought it? Is buying at a steep discount as important as waiting for a low price?
    Sep 23, 2013. 07:41 PM | Likes Like |Link to Comment
  • Equity CEFs: A BlackRock Energy Sector Fund That Gets No Respect [View article]
    Doug,

    A macro-type question, if it's not too late:

    When I look at the 3- or 5-year charts for the EV funds you recommend, most of them start at the lower left and go up steadily toward the upper right, with the occasional minor dip. The chart for BOE, on the other hand, hit a high in June 2011, took a dive later that year, and, though it's recovered somewhat, is still quite volatile and has never recovered its high. It's as squiggly as a snake. This makes me nervous, and I can't see any reason to buy into it, especially if it involves selling EV funds (which I only know about because of your articles here...).

    So my question is, why the emphasis on total return compared to a benchmark when both can change so quickly (in a quarter, in fact)? Do you consider long-term chart performance? I'm not really a sophisticated investor--money talk makes my eyes glaze over--and I value your expertise, but I don't want to be trading in and out of funds all the time. I just want to buy and hold, which I recall a couple of people here commenting they've done successfully with CEFs over an extended period. So I wonder why you recommend these short-term trades based on a benchmark comparison when it could easily go the other way next quarter.
    Jul 24, 2013. 06:42 AM | Likes Like |Link to Comment
  • 14 BDCs - The Good, The Bad And The Maybe? Part 10: THL Credit [View article]
    Buzz,

    You say, "Below is an oversimplified table" and "In reality I use different weightings for each criterion." Could you show us what your non-simplified table looks like?

    Thanks--great articles.
    Mar 5, 2013. 12:52 PM | Likes Like |Link to Comment
  • 13 BDCs - The Good, The Bad And The Maybe? Part 9: Golub Capital [View article]
    These articles are very helpful, Buzz--thanks.
    Mar 4, 2013. 12:55 PM | 1 Like Like |Link to Comment
  • Equity CEFs: The Insanity Of CEF Investors Revisited [View article]
    "I believe the stock and bond markets will be running into more resistance at this point."

    In previous articles or comments, you've suggested in down markets shorting an index or buying an inverse index up to 1/3 of the portfolio. Would this involve selling CEF shares in a declining market and taking the loss to finance the short position? (I assume you're not suggesting keeping 1/3 of the portfolio in cash to be able to short or buy inverse ETFs if necessary?)
    Feb 25, 2013. 06:22 PM | Likes Like |Link to Comment
  • Equity CEFs: The Insanity Of CEF Investors Revisited [View article]
    "I believe the stock and bond markets will be running into more resistance at this point."

    In previous articles or comments, you've suggested in down markets shorting an index or buying an inverse index up to 1/3 of the portfolio. Would this involve selling CEF shares in a declining market and taking the loss to finance the short position? (I assume you're not suggesting keeping 1/3 of the portfolio in cash to be able to short or buy inverse ETFs if necessary?)
    Feb 25, 2013. 06:22 PM | Likes Like |Link to Comment
  • Business Development Companies: The Good, The Bad, And The Maybe? Part 3 [View article]
    BDC,

    Thanks for writing these articles--very informative.

    FINRA publishes an annual Regulatory and Examination Priorities letter in January. The one last month (http://bit.ly/14TPmw9) says, "BDCs are typically closed-end investment companies. Some BDCs primarily invest in the corporate debt and equity of private companies and may offer attractive yields generated through high credit risk exposures amplified through leverage. As with other high-yield investments, such as floating-rate/leveraged loan funds, private REITs and limited partnerships, investors are exposed to significant market, credit and liquidity risks. In addition, fueled by the availability of low-cost financing, BDCs run the risk of over-leveraging their relatively illiquid portfolios."

    Does this concern you, or do you think it's mostly pro forma? (They also caution against some other types of high-yield investments.)
    Feb 14, 2013. 03:23 AM | Likes Like |Link to Comment
  • PennantPark: BDCs - The Good, The Bad And The Maybe? Part 4 [View article]
    I submitted this for the previous article by mistake--didn't know if you'd see it:

    BDC,

    Thanks for writing these articles--very informative.

    FINRA publishes an annual Regulatory and Examination Priorities letter in January. The one last month (http://bit.ly/14TPmw9) says, "BDCs are typically closed-end investment companies. Some BDCs primarily invest in the corporate debt and equity of private companies and may offer attractive yields generated through high credit risk exposures amplified through leverage. As with other high-yield investments, such as floating-rate/leveraged loan funds, private REITs and limited partnerships, investors are exposed to significant market, credit and liquidity risks. In addition, fueled by the availability of low-cost financing, BDCs run the risk of over-leveraging their relatively illiquid portfolios."

    Does this concern you, or do you think it's mostly pro forma? (They also caution against some other types of high-yield investments.)
    Feb 14, 2013. 02:58 AM | Likes Like |Link to Comment
  • Equity CEFs: The Most Undervalued And Overvalued Funds [View article]
    Doug,

    Your articles on CEFs are outstanding--thanks for providing them.

    Do you recommend buying funds even if the price is comparatively high (as most are now), as long as they have a substantial discount, or is it better to wait till prices comes down, even if the discount isn't as large? Seems like there's an unexpected plunge every few months (e.g., last Nov. 15), and I can't decide if it's better to wait in cash for that and lose the distribution income or just buy the funds now. If you'd wait, how small a dip would induce you to buy?

    Thanks,
    JC
    Feb 4, 2013. 02:44 PM | 4 Likes Like |Link to Comment
  • Levered Municipal Closed End Funds: A Cautionary Tale [View article]
    I was actually addressing my comment to the author, not to your post. Sorry for the confusion.
    Nov 25, 2012. 12:40 AM | Likes Like |Link to Comment
  • 4 Strategies For Increasing Yield And 11 CEFs That Will Help You Profit [View article]
    Both are a fund of funds. You could just hold some of the underlying funds for a higher yield.
    Nov 25, 2012. 12:40 AM | 1 Like Like |Link to Comment
  • Levered Municipal Closed End Funds: A Cautionary Tale [View article]
    Although your thesis is reasonable from a theoretical point of view, it turned out to be wrong. With the benefit of hindsight, I clicked the first half dozen tickers above and looked at their 1-year results. All have increased. So much for prognostication.
    Nov 23, 2012. 09:51 PM | Likes Like |Link to Comment
  • Levered Municipal Closed End Funds: A Cautionary Tale [View article]
    PCEF is a fund of funds (like FOF), and its expense ratio is 1.58 -- so you're paying them a high fee and also, indirectly, the expense ratios of the underlying funds. You could just buy a few of the underlying funds directly and get a higher return.
    Nov 23, 2012. 09:51 PM | Likes Like |Link to Comment
  • Retirement Strategy: Replacing Yield With More Yield [View article]
    No motives at all, other than trying to reconcile the opinions of two authors that are 180 degrees apart. I didn't say the portfolio was no good--just that I wondered how you made any money, after inflation and taxes, with dividends of 4-5%. Inflation alone is 2-3% (http://bit.ly/TqJYhZ), and taxes would take another 25-35% of what's left. It appears this would leave a real return for dividends of 2-3%. My own calculation is that a dividend of at least 8% would be necessary to overcome that. I myself own a bunch of mREITs, including AGNC and NLY, along with some BDCs and other industries, and don't intend to sell yet. I do subscribe to a service, but it's a small one that most people on SA probably don't know about. The results are middling.

    As far as the portfolio making money, a lot of stocks make money when the market is going up, so I'm not sure it's attributable to this portfolio. Not trying to be combative, just wanted to understand the reasoning for your choices.

    Jim Comar
    Oct 21, 2012. 08:36 PM | Likes Like |Link to Comment
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