I wish someone would tell me why they own SRV. Morningstar gives SRV 1 Star, which is it's lowest rating. SRV had it's IPO on August 27, 2007 at $20 a share. Now selling at 10.48. M* states adjusted expenses are 3.74%, leverage is nearly 18%, and it sells at a 24.94% premium. If M* 's figures are correct, why anyone would own SRV? http://cef.morningstar.com/quote?t=srv
LEVERAGE and deferred taxes are about 31% of total assets. Went public in AUGUST 2007 and since NAV has fallen by about 50% due to POOR Investment performance. Cut the Distribution by about 33% in Sept.,2009. Management fee is 1.25% vs others @ 0.85%
My guess is that these are the issues that Morningstar has a problem with.
I have the same questions. What happened to cause the NAV to drop from $20 to, at one time about $6, and now is about $10. This is crazy. Something happened to cause this. MLPs as a whole did not do this. Does anybody have any idea what happened.
I just asked the same question (see earlthebull 16 June,2011); Yes, I want to know what's gong on with this fund too! I have some money in this fund, if I wanted only dividends it would be fine, but stability and some growth is even better. dividends to hedge against coming inflation and growth to draw income from.
"Distributions over the past twelve months were classified as 100% return of capital. However, this is not the same type of ROC paid out by funds with a managed distribution policy that need to supplement their distribution by drawing on their equity base.
In contrast, the fund's distribution reflects the return of capital, which is essentially cash flow, that most MLPs pay out. The income is not taxable until the fund is sold, when it is charged against the cost basis. The difference between the purchase price and the reduced cost base is taxed as ordinary income."
Stock's been great; I'm up 25% in few months since buying middle of Sep counting today's down. They intelligently use small leverage at todays give away interest rates. They have no K1 which is a very large plus over other MLP's (for IRA's) and give access to MLP's that are not public. Great way to participate in Oil rise. Morningstar rated my money fund a 5 just 1 month before they broke the buck so don't trust their research which in that case was none. Top pick of some of analysts such as Seda (see news).