I think you are on my wave . Time is to watch for
a bit , before buying .FAX is as good in what it
does as we can buy .BUT ,we have to buy at the best
time and best value .With a cut in the rate FAX will
pay -WAIT for the change - the price will adjust fast
.Cost averaging is best done when the value is the best
As to price -how much will the payout be cut ? I do
not know -will wait and see .
I will buy if the
discount is larger-maybe -20 to -25% --yes larget than I
said a few week ago-before the I new about the meeting
should fall to where the yield rivals other
similar risk investments. I think FAX is valued more like
a bond than a stock. However, if there is tax
selling driving the price artificially lower, there may
be a buying opportunity.
Unfortunately, as I
recollect, FAX has never raised its dividend. I remember
when it was around $1.09 a year and there have only
been cuts. Dividend reinvestment however, as a sort of
dollar averaging, has still made this a relatively
cut in this month meeting, would be my
The NAV is $6.18 and the discount at $5.375 is over
13% now. I wouldn't think they would cut the dividend
more than a penny a month. If that was the case than
the yield would be near 11%. Probably about right for
The fund still has a very high quality
portfolio, far better than most in the Global markets. Based
on it's "real" earnings of $.48 it's still a 9%
yield. Good not great in this enviroment it
I would rate the stock a hold, if people could live
with possibily more short term sell off. If the BOD
cuts the dividend you can guarantee the stock will
have a downdrafts from where ever it is
I might get back in at that time. It looks like the
average quality is still a strong A and the average
duration looks in the 5 year range. A comfortable profile
for risk level, IMO.
At $5 or below, IMO the
discount would more than compensate for the lack of
earnings on the portfolio. At $5 the stock is a 19%
discount, that should give plenty of principle protection
Any others...a buy level??
Down to $5.25 and if you believe in momemtum it
is likely to go lower fairly soon. Tax selling? Fear
of dividend cut? Definitely the first and
possibly/probably the second.
If they do announce a
dividend cut in December, I would expect FAX to drop like
a rock. Dividend cuts leads to selling and a lower
price, which leads to even more tax selling if done in
December, which might lead to panic selling, getting near
or below $5 can lead to even more selling.
We appreciate your comments. We have tried to
make this FAX message board a place where anyone can
state their opinions and ask simple questions without a
condescending response to alienate anyone. Certainly different
opinions are welcomed....cut the attitude, please.