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AlbionWood

AlbionWood
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  • Gilead: Let's Make A Deal [View article]
    Isn't that the PEG<1 metric many people use?
    Aug 28 02:53 PM | Likes Like |Link to Comment
  • Trying To Follow The Dow [View article]
    You still don't seem to grasp the difference between an equity portfolio and an option-income fund overlying such a portfolio. In fact it is not clear to me, from what you have written here, that you understand the purpose of an option-income fund. I can see how someone who does not grasp those (admittedly somewhat complex) distinctions might be confused and even misled by Nuveen's reporting, but someone writing articles for SA is expected to demonstrate a greater level of understanding.
    Aug 27 12:59 PM | Likes Like |Link to Comment
  • Trying To Follow The Dow [View article]
    I don't find "to substantially replicate price movements of the Dow" in Nuveen's objectives for either Fund. Under "Investment Strategy" that phrase appears, but you have taken it out of context and changed the meaning: "The fund invests in an equity portfolio that seeks to substantially replicate price movements of the Dow Jones Industrial Average"

    Do you see the difference? The Fun invests in an equity portfolio that replicaes the Dow, but the Fun objective is not to replicate the price movements of that portfolio - rather, it is to throw off regular distributions (exceeding the portfolio dividend yield) with some capital gain potential.

    Here for example is DPD's Objective: "The Fund's investment objective is to provide stockholders with a high level of current income, with a secondary objective of capital appreciation "

    Misrepresenting the goals of these Funds doesn't give me much confidence in the author's analysis.
    Aug 25 07:10 PM | Likes Like |Link to Comment
  • Trying To Follow The Dow [View article]
    These funds are NOT intended to replicate the price movement of the Dow, and Nuveen does not make that claim. They are option-income funds and are intended to provide high income - much greater than the Dow yield - with substantial proportions as Return of Capital (NYSE:ROC) for tax purposes. They are best described as "tax-advantaged income funds" with a capital gain component.

    Here is Nuveen's objective for DPD: "The Fund's investment objective is to provide stockholders with a high level of current income, with a secondary objective of capital appreciation "
    And for DPO: "The Fund's investment objectives are to provide stockholders with a high level of premium and dividend income and the potential for capital appreciation "
    No stated intention to replicate any index's price movement, substantially or otherwise.

    This article appears to be predicated on a claim that is false, so it has very little utility.
    Aug 25 06:46 PM | 1 Like Like |Link to Comment
  • The Dividend-Growth-Devoid Income Portfolio [View article]
    Buy-write closed-end funds (CEFs) might be one of the best options for your hypothetical investor who needs around a 7% yield. They are defensive, offering lower volatility than individual stocks or even the market indexes, while throwing off steady distributions of 7 to 8 percent. (Some are much higher, but those can be riskier; and some are much lower, because their prices have appreciated too much. 7% seems to be a "sweet spot" where the distributions are sustainable and NAV still grows.) The income is also tax-advantaged.

    Douglas Albo and Left Banker have written some useful articles on SA about CEFs. Albo in particular has helped me identify some very lucrative opportunities when discounts to NAV (common with CEFs) increased byond the normal ranges.
    Aug 19 05:30 PM | 2 Likes Like |Link to Comment
  • Buy-Write CEFs Are An Alternative To An S&P 500 Dividend Fund [View article]
    LB - It sure is! Far from the madding crowds.
    Aug 18 01:53 PM | Likes Like |Link to Comment
  • Barron's Highlights Some Attractive Tech Stocks [View article]
    Followed that advice, thanks Bret.
    Aug 18 11:41 AM | Likes Like |Link to Comment
  • Buy-Write CEFs Are An Alternative To An S&P 500 Dividend Fund [View article]
    LB - My comment was in reply to one of User 8202401's comments above. (SA sometimes threads these correctly, and sometimes not, and I can't figure out why.)

    My point was that his hypothetical ETV investor was still better off, even after the dividend cut, with an income of $70K/yr than the SDY investor with $32K/yr - contrary to User 8202401's conclusion. He seemed to be saying that net worth is more important than income; as someone living off my investments, I can tell him that is not the case for me.

    Too many analysts and advisors approach investing for retirement as if it is some sort of game, where the score is determined by net worth or some other financial metric. This leads to the pursuit of wealth rather than the pursuit of happiness. Having a flexible plan that allows one to adapt if circumstances change is much more important than any magic number.
    Aug 16 12:34 PM | Likes Like |Link to Comment
  • Buy-Write CEFs Are An Alternative To An S&P 500 Dividend Fund [View article]
    And yet... your ETV investment is still paying more than twice the income as the SDY. Your hypothetical investor's real problem is spending - he is living beyond his means. Decreasing retirement income isn't good, but it's manageable if you aren't foolish.

    In general, I dislike all analyses that start with assumptions about how much income you "need." Lifestyle is entirely discretionary, and adaptation is the most robust strategy. The question should have been "how much can I spend each year going forward to keep the capital and income from running out" (as your hypothetical ETV investor eventually realizes) right from the start. The obvious answer is, spend last year's income.
    Aug 15 12:28 PM | Likes Like |Link to Comment
  • Yes, Me Worry [View article]
    201 minutes... One of the greatest parodies EVAR.

    I think "True Fat" was the best, though.
    Aug 14 09:43 PM | Likes Like |Link to Comment
  • Retail Investors About To Get Fleeced Again [View article]
    Yes, especially the second, a really good analysis that debunks the simplistic notions expressed by so many pundits.
    Aug 13 02:46 PM | Likes Like |Link to Comment
  • What Happened To 'Peak Oil'? [View article]
    If you say so, Aeroguy. TOD hosted a lot of interesting discussions, including some really knowledgeable people with many different points of view. I loved the robust debates, the scrutiny of data and ideas, and learned a lot there. Many of the contributors are still writing about their particular interests, just not on TOD. I think they just felt the site had accomplished what it set out to do.
    Jul 15 02:02 AM | Likes Like |Link to Comment
  • Buy-Write CEFs Are An Alternative To An S&P 500 Dividend Fund [View article]
    CEFs have done well for me, since Doug Albo wrote some very good articles explaining how they work (especially the tax advantages of ROC). Just wish I'd loaded up more heavily when they were on sale! From time to time, the discount to NAV widens and these are generally excellent times to load up on CEFs.
    Jul 12 01:29 AM | 4 Likes Like |Link to Comment
  • What Happened To 'Peak Oil'? [View article]
    Not only more descriptive, but more accurate. The "Hubbert peak" was a real inflection point, followed by an accelerating decline; and people extrapolated that from the US to the world without considering the inherent difference. When US production peaked, we simply imported more oil, and eventually price stabilized. If/when the world peaks, there is no external supply to offset the decline, so other factors come into play - in particular, market forces. Price action drives renewed exploration (there is more oil available at $100 than there was at $20), as well as reducing demand and shifting to alternatives. All those factors tend to produce a plateau, not a peak.

    I think I first saw the term and concept used by Stuart Staniford on The Oil Drum. There were robust discussions about it back in 2005 - 2008.
    Jul 9 05:11 PM | Likes Like |Link to Comment
  • What Happened To 'Peak Oil'? [View article]
    In theory, there is no difference between theory and practice; but in practice, there is.
    Jul 9 02:12 PM | 1 Like Like |Link to Comment
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