% | $
Quotes you view appear here for quick access.

Kinder Morgan ManAŞement, Ltd. Şti. Message Board

you are viewing a single comment's thread.

view the rest of the posts
  • sgwdjw sgwdjw Aug 3, 2009 9:59 PM Flag

    Distribution Date - When

    Abter: Thanks again. I think you have explained to me why my approach is a good one but not the only one that would accomplish my goals of: 1. limiting my holdings of KMR, 2. monitizing the dividends. I believe you are saying it would work either way because the way I do it, selling a slightly smaller number of shares at a higher price, would be the equivalent of selling the full number of shares at a lower (that is, minus the dividend dollar amount) price. The product of the two comes out the same (obviously less commission which is negligible in my case) if you presume the difference in the selling prices is the dividend amount, and that I correctly calculate the number of shares to sell. Please correct me if I misunderstood your conclusion.
    If I understand you correctly, I am very pleased with that analysis. I think my preference to sell pre-ex div date works best for me because by the time I sell I have a very good idea what the dividend factor will be so I can choose to sell above that price and generate a slightly higher return. I don't risk losing that price over the next 2 weeks, and my goals don't include the need to time the market. As I've noted in a previous post, KMR frequently trades well above the 10 day average price (less the dividend amount) during the post-ex period, as it is doing right now. But, given my holdings of KMR and the fact that on Aug. 14 I will receive back the shares I just sold, I am more than happy to see the price go up, although as I've also noted, it wouldn't be unusual for there to be a downward movement in the following weeks.
    Anyway, I really appreciate your work as I think I understand better that my actions are price neutral. Also, your analysis suggests there isn't really anything wrong with the concept of KMR issuing a stock dividend every quarter and assigning a dollar value that the market uses as a dividend rate for KMR. Of course, that leaves us no better off in trying to explain the KMP/KMR price differential: in fact, that differential looks just as irrational as ever!