Anyone know? I don't see any headlines or anything to have prepare me for this. NOT that I'm here for the buy / sell, I like the dividends, but it is nice to have an understanding of what triggers a $0.60 drop in a day.
"You are not explaining facts, you are giving your interpretations, which are wrong." Okay, zunk11, perhaps you can explain these facts:
1) DNP trades at a 40% premium to NAV.
2) During 2011, Current Income (i.e. net dividends and interest income from underlying assets) accounted for only 60% of the monthly cash distributions.
3) DNP's $2.8 billion of assets are supported by $800 million of short term borrowings (44% of equity).
Well, I wasn't responding to you but to jackomusic2 post, unless you're the same person, and that would be truly bizarre. Maybe you saw 'perma-bear'in the post and thought I was referring to you??
You are not explaining facts, you are giving your interpretations, which are wrong. I don't feel like going over them all now, but I will sometime. It of course won't change your perma-bear mantra. The bottom line fact is you've been 100% wrong in your predictions.
What happened was just selling a big gainer at year end, ex-div, with a bit of herd mentality. Like someone else said, it's cap gain/loss selling, inst. window dressing, etc.
If you look at the last great year we had, in 2009, there was a selloff at almost exactly the same date. We actually had a bigger selloff this year, in AUG., when it dropped 10% intraday.
Personally, I don't usually sell my IRA DNP shares- I've found over the years it's better to just ride the cycle, DCAing at a discount. I did sell some this year at 11, and 11.10 however, only because I was low on cash in my IRA's and saw some other good opportunities. And hey, it was one of my best performing stocks YTD, ok to take some off the table. I will buy back @$10, and buy in steps if it drops lower.
I wish you all a healthy, happy and prosperous New Year!
DNP had a bit of a pop up as trading was ending on the day. Nonetheless, the initial drop down more than 5% was stunning! Morningstar rates this CEF highly, so the drop down--with no news available anywhere--was shocking. It will be interesting to see the price action on Friday, Dec. 30. To paraphrase Bette Davis, fasten your seat belts, we're in for a bumpy ride.
I think some investors who have losses to date might sell some of their winners (and vica versa)like DNP to file their most advantageous capital loss/ gain tax return. If they had a gain on DNP they can always buy it back lower and not worry about 'wash sale' tax rules. I hope to get back in around $10 after first of the year.