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Gabelli Utilities AAA Message Board

  • blackjackkid41 blackjackkid41 Mar 3, 2012 12:03 AM Flag

    NAV

    Fredkane.......

    I seldom post on this board although I do own 1000 shares of GAUCX. I often read your posts and feel that you contribute alot to this board.

    Here is something that has concerned me for some time with both GAUCX and GABUX.

    Please explain to me, if you can, why the NAV for both GAUCX and GABUX has not moved up in over three years, while the Utility Sector has performed very well. That`s my concern. Can anyone answer this because this doesn`t compute and seriously concerns me.

    I posted a similar message on the GAUCX board for a response.

    Thanks for your help. Hopefully you or someone else can put my mind at ease.

    http://finance.yahoo.com/q/bc?s=GAUCX&t=5y&l=on&z=l&q=l&c=GABUX

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    • Both jannjim and fredkane have spelt out the very premise of the gabux fund fundamentals.

      Their response basically takes the prospectus and lays out gabelli's management direction quite well....and when/if nfg, or the several other stks in the holdings of gabux experience consolidation, you will see the nav rise accordingly as well.

      Basically, if one reads the latest gabelli earnings report, there would be no doubt about what gabux is all about, and what it should do as we go forward.

      Gabux is a fund that requires one's complete understanding. Failing to do so opens the door wider to failed investment goal attainment.

    • GABUX will never match the utility sector share price returns or the returns of individual utility stocks. That's because it pays $.07 cents a month in distributions. That reduces the NAV every month on the ex-div date. GABUX is an income fund, not a growth fund or a stock and not all investors realize it.

      Despite what the kid posted in response to you it is all about total return, just as it is with any investment. I think GABUX is a good investment for someone who can tolerate NAV swings that conservatively follow the general market up or down and wants a steady monthly distribution. So it isn't for everyone.

      But I have to differ from you when you say that the NAV hasn't moved up in over three years. Within the past three years the NAV was below $5. It was at $6.66 last May, 2011. So it has moved up over three years. It has also fallen down over three years. It has generally followed the overall market, but the distribution skews a comparison of share price. It's why you have to look at a chart that compares an investment of $10K to another investment.

      It's not about management, it's about this fund's purpose in a portfolio. If you want share price growth in utilities then invest in the exchange traded fund IDU. You'll get a 3.4% yield and you'll get better share price appreciation. If that meets your portfolio needs better then I think that might be a better choice.

      What some people don't understand is that GABUX will never see explosive growth unless the market and utilities suddenly explode. It just will not happen. Utilities are a defensive conservative sector. It's why we get stupid remarks from some posters here who think that they are going to get the same distribution and big NAV growth at the same time. It just will not happen. Those comments from people are comments from ignorance.

      • 3 Replies to fredkane3947
      • Hi All:

        I check this board for useful information, which I often find, but seldom post. Good overview of GABUX and its' objectives, and the the important caveat that one must align a given investment with their own goals. In my case I have GABUX in both taxable and non-taxable accounts, DRIP in all cases, and have accumulated over 26,000 shares...16 years to "retirement" and for me anyway I hope things continue as they are now in terms of GABUX, for obvious reasons.

      • GABUX is only about 55% in utilities, so its no wonder it does not follow the utility indexes. Right now it is invested in three sectors(tele coms, energy, utility) that are trailing the overall market leader for the year (tech). Also, Mario has made some large bets on specific stocks (NFG for example) everyone was cheering last year when NFG hit the 70s, now not much cheering as NFG is back in the 40s.

      • fredkane,

        " GABUX will never match the utility sector share price returns or the returns of individual utility stocks. That's because it pays $.07 cents a month in distributions. That reduces the NAV every month on the ex-div date. GABUX is an income fund, not a growth fund or a stock and not all investors realize it. "

        thank you for taking the time and your detailed response. much appreciated.

        Here is another question for you, if I may ask.

        How does Gabelli Utility Fd AAA and C constantly keep cranking out a Return of Capital. I know that the Prospectus defines them as Tax Advantaged Fds. But how do they manage to do this? You would think, that they would at one time or another generate and report Taxable Dividends right? I know it`s my misunderstanding of how the funds are structured. It would appear that ultimately your capital would just evaporate. I`m not being disrespectful, just confused. What am I missing?

        Could you please clarify this misunderstanding for me! Thanks

    • You are right in what you say the performance has been poor on the NAV. Now a large part of that is the .07 dividend coming out every month, also they store up a lot of cash, which doesn't appreciate in value like an equity would, but even with that it still should be doing better.

      I imagine the real answer lies with fund management.

    • Mario and gamco are stepping on returns and we want the good stuff !!!

    • Yeah, quit hiding behind total return on 10k after thus and so many years!!!

      We re tired of hearing those old tapes...

      We want some NAV advancement like the old days + the fatty dividend...

      BUMP

    • Fredkane....here is a follow up to my previous post....

      ************************************

      "" Please explain to me, if you can, why the NAV for both GAUCX and GABUX has not moved up in over three years, while the Utility Sector has performed very well.""

      ************************************

      Fredkane, I forgot to post a link on the Utility Stocks that I own, namely D DUK NEE PGN.... You will note that they have performed much better then GAUCX and GABUX...

      http://finance.yahoo.com/q/bc?t=5y&s=DUK&l=on&z=l&q=l&c=+D+NEE+PGN+

      As mentioned in my previous post, the Performance Issue with GAUCX and GABUX i.e, NAV/PRICE Appreciation is my concern.

 
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