ADX: 4 Reasons To Be Cautious Despite Recent Outperformance

Blue Chip Portfolios
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Summary

  • Adams Diversified Equity Fund seeks long-term capital appreciation and dividend income by investing in large-cap US companies.
  • ADX has a very long history and has outperformed the S&P 500 over the past 10 years.
  • The fund charges a high management fee and has a fixed distribution policy, which creates a potential tax drag.
  • I am initiating ADX with a hold, but would turn more bullish if the discount to NAV were to widen moderately from current levels.

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Torsten Asmus

The Adams Diversified Equity Fund (NYSE:ADX) is a closed end fund ("CEF") which seeks to deliver long-term capital appreciation by investing in a blend of high quality, large-cap U.S. companies. The fund seeks to beat its benchmark, the S&P 500, and consistently distribute

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Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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