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Alliancebernstein Income Fund Message Board

  • brudge1850 brudge1850 Nov 12, 2001 3:33 PM Flag

    Re: Large Dilution????????HELP

    Very good question, I would like to see some
    answers to that too!

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    • They will go heavily into high yield corporate bonds from companies that hopefully won't default, high risk emerging market debt, and preferred stock from companies that are beaten down. If everything goes right, ACG will do ok. If not, .......! That's where the yield is and that's where the risk is.

      • 1 Reply to axzl
      • manipulator. I have owned this fund for several years. It has paid many of my monthly expenses. There are many who rely on monthly income to ppay their bills. The managment has stated they are only doing rights if it is additiveor accretive to monthly dividends. So post rights they will be raising dividend lets say to 7.5 cents a month or 90 cents a year. Now NAV is about $8.90 a share. In an environment where there will be no more 30 yr bonds the ACG fund being 75 % 30 yr bonds is in the cat birds seat.Also with 3 % cds ficed income investors have no choice assuming they need monthly income. This means ACG should get a premium. Assuming 68 million shares or 30 % of oustanding shares are offered to present holders at a 5 % discount to NAv or $ 8.50 share and the other 70% are worth $ 8.98 his means 100% of the shares are at $8.85 or the present price. However after the offering or sooner these shares will get a premium because they could be yielding over 10% in an environment where cds are 3-4 % and people need good yield and income. So fair value will be in the high 9 range

 
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