Do the holders of PHT know that this is currently trading at a 20% premium to the NAV? If you do know that and continue to hold it, please respond as to why? I'm genuinely curious as to why someone would buy at a 20% premium and receive a 10% yeild on the div. There are several other names that trade a much smaller premium with comparable yields. Thoughts?
Tim, and now with an even more negative position for bond funds, PHT is at a 22% premium. I'd suggest you notice the 9.6% dividend rate and the UNII of $.5525 per share. Where can to beat that? They are earning more than the dividend they pay which justifies the premium and my investment dollars. Play it as you see it. best of luck to you. I'll leave my money where it generates a solid income , even in a hostile environment.
Yes, I'm thinking of adding to my PHT holding. One of the most reliable bond funds, PHK, has a 60% premium which many are willing to pay because the payout hasn't changed in over a decade. In comparison, PHT gives you the same thing for a much lower premium.
I know this topic is old, but just to say premium and discount is over rated. If the fund is well run, and keeps a steady divy comming it, it earns the premium and can charge it. Funds that don't do so well end up in discount land usually.
20% premium is around the historical average, although it's spiked into the high 30's at times, rarely dips below 15% - it's one of the best performing, best run fund of it's type - beats the pants off the competition over any time period you want to look at - from CEFConnect:
5 Year, 10 Year, Inception
Price 18.14%, 13.70%, 13.56%
NAV 15.91%, 12.B4%, 12.97%
Group-Price 12.11%, 7.11%, 6.73%
Group-NAV 11.14%, 7.54%, 7.79%
I was lucky to get it in Oct '09 for a 9% premium and May '10 for a 5% premium. It's a keeper!
PHT has been paying a consistent monthly dividend of $0.1375 since 2002 (with the occasional special div thrown in for good measure). As of 03/31/2013 they were earning more than enough to cover the div, i.e. $0.1492 per share. Furthermore, as of 03/31/2013 they had UNII of $0.5525 per share, which would be enough to cover 4 months of dividends even if their earnings dropped to zero.
To be honest I don't know how they do it, but so far the numbers continue to look good.