Good thought ...and pretty much exactly why I try and figure out where they get the cash to fund that $155 million per year dividend requirement ....they have about $134 million in Unrealized appreciation on the books , plus standard dividend stream income from the 58 stocks in the portfolio ( pretty much a wash when you subtract the investment management fee and other fund expenses though ) ....
They are sustaining about an 80% annualized portfolio turnover and a quick , back of the napkin calculation, makes the proceeds from selling 80% of $1.6 billion in assets at roughly $1.28 billion ...so they have plenty of cash on hand thru normal proceeds of SELL transactions ...and doubtless are using a portion of the proceeds to fund the approximate $13 million per month of dividend distributions ....in their managed distribution program and can easily just call a big portion of the dividend non-taxable ROC ....
Another metric to evaluate the sustainability of the $0.084 per month dividend is to look at the annualized dividend distribution as a percentage of the $11.44 NAV ( ETY pays $1.008 per share annually / $11.44 NAV = 8.81% they need to EARN from portfolio assets ...) Not an impossible task and certainly achievable in a sluggishly upward market ...like we have seen thus far in 2016.
Finally, historical perspective and lessons learned are a BIG FACTOR with this management team ...They slashed the quarterly dividend from $0.406 per share to $0.29 per share back in Sept 2011 ...a 28.5% cut ...and surprisingly investors didn't punish them and again in May of 2012 with a further 12.7% cut to the dividend ...and investors stayed with them as the cuts were prudent given the market. EV management can and will cut the distribution when conditions demand it ...It seems likely they can sustain the dividend as long as the NAV that they are working with only requires a sub 9% performance ....
Just my opinion ...but hope it proves helpful -
Thx - Mike
ETY - continued -
and the annualized turnover would be right at 76% as compared to 85% in 2015 , 83% in 2014 ...so we can impute that fund management is continuing its tactic of selling appreciated stock positions as soon as they get past the 365 day minimum holding period ...passing thru to investors a 15% capital gains tax rate ...HEY ...it beats the socks off paying typical marginal tax rates of 25% or more ....and is a key feature that may tend to attract investors looking for a good / tax efficient yield.
No information on Return of Capital in this "half time" report ...but recall the management team's earlier tendency to re-characterize dividend distributions from ROC to capital gains in 2015 and 2013 ....to ZERO ROC ...
As I have speculated before, with ONLY 58 stock positions in their fund; and an 80% annualized portfolio turnover ( three years in a row now ) , it must be a delicate balance for them to have to maintain ...selling positions AFTER they clear the 365 day holding period and sustaining the $0.084 per share monthly dividend distribution ....all in a tax advantaged / favorable manner ....
At this writing , market price is $10.50 per share with an NAV of $11.42 ...to equal an 8.04% discount to NAV ...( am suggesting a NORMAL discount rate of -5% ) so ETY is trading at an increased discount as are many other closed end funds ....WE are getting a current market YIELD of +9.6% on this fund ...much of which will be tax advantaged capital gains or non-taxable ROC when the tax forms are sent out ...
Summary - Good way to HOLD those TOP TEN BLUE CHIP stocks ...at a nice discount to their inherent market value ....while collecting the + 9.6% annualized dividend yield ...much of which is automatically reinvested back into buying more shares ...sort of a DOLLAR COST AVERAGING methodology with 12 new purchases per year ....Over time ...your 9.6% per year reinvestments of the dividend will REALLY add up to a significant number of new shares ...
Received the paper copy of the semi-annual report ending April 30,2016 and here are some takeaways along with some opinions ...Hope they prove helpful.
Performance - Trailing six months - ETY - ( -4.15% ) at market price VS S&P 500 at +0.43% over the same period.
OK ..that is not good ...but wait ...performance trailing from Jan 1, 2015 - Jul 9, 2016 = +8.23% for ETY and + 6.77% for the S&P 500 index with dividends reinvested. Call it a 1.51 year measurement and that makes the relative performance in hard TOTAL RETURN dollars much easier to accept.
ETY management reports that the fund holds 58 total stock positions in an aggregate $1,662,967,228 in value.
Top positions are : Alphabet 4.6%,GE 3.6%,Amzn 3.3%, MSFT 3.2% , J&J 3.1%, Visa 2.8%,Apple 2.7%,Danaher 2.5%, NXP semi 2.3% and JP Morgan 2.3% - these 10 stock total 30.4% of the fund ...
21% of fund investments are in INFORMATION TECHNOLOGY, 14% FINANCIALS, 14% Consumer Discretionary and 14% HEALTH CARE ....
ETY continues to SELL CALL OPTIONS against about 48% of portfolio with an average 18 days to expiration.
Some areas of concern : ETY has LOST value ...a NET decrease in value over the six moths ending April 30 , 2016 of $119,551,688 ....They scored a net LOSS of $86 million during the first six months of their fiscal year from investment transactions as compared to a GAIN of $121 million the previous fiscal ending year ....Their net investment income is WAY DOWN ....from $31,557,069 for fiscal 2015 to a measly $8,792,856 for the first six months of fiscal 2016 ....OUCH / OUCH ....but much of this can be attributed to the volatile market in the early months of 2016.
ETY does have overall NET UNREALIZED APPRECIATION on its books of $135,692,872 which is a SOLID / GOOD sign ....and gives management the ability to SELL and pay the estimated $151,177,773 annualized dividend distribution in the form of long term capital gains ...
Portfolio turnover is still a ROBUST 38% for the six month period
Thanks for your question ...Short answer- refer to the 2015 Annual report ( audited ) and see where EV management " recharacterized the entire fiscal year distributions as capital gains and income ...AFTER ...sending out monthly reports indicating that the dividend distribution was highly concentrated in ROC ...They ARE allowed to do this ..and have done so in the past ...2013 for example ...
What are they doing ? even better question ..they have an 80-85% annual portfolio turnover and need to get the all important holding period of their some 55 stock positions to 365+ days ...in order to QUALIFY for Long Term Capital Gains tax treatment ...I suspect that might be harder to accomplish when you are effectively SELLING 80% of your overall portfolio every 12 months ...
Reference the actual name of the fund : Tax Advantaged Income fund ...and LTCG are definitelly tax advantaged as compared to Ordinary Income or Interest Income ...ROC is not taxable ...as they are simply returning some of your original capital investment.
The long arguement AGAINST funds with a high degree of ROC in their distributions is that it will eat away at your net original investment ...Ok ...look at page 12 of their 2015 annual report ...
NAV by year - 2015 - $12.34 . 2014 -$11.87 , 2013 - $10.96, 2012 - $10.83 , 2011 - $12.21
ETY is NOT " eating " their own NAV up with destructive ROC as evidenced above
Distributions by year - 2015 - $1.012, 2014 -$1.012, 2013 - $1.096 , 2012 -$1.085 and 2011 - $1.274
ETY has distributed $5.479 over the last five years ...some was definitely ROC but the NAV has remained fairly stable ..even increasing from 2012 thru fiscal end 2015.
All numbers audited and certified by Deloitte ...
Hope this helps answer your concerns -
In an earlier posting, ( 11/6/15) I suggested that a $10.35 market price might be a logical point to try and " bottom fish" for additional shares of ETY.
With the additional trouble in China and the glut of oil supplies driving down the cost of oil ...The NAV of ETY, despite owning literally thousands of defensive S&P 500 index Call options each month, has steadily declined to $10.96 per share NAV with a Friday close market price of $9.88 per share.
This inputs a 9.85% discount to NAV on a closed end mutual fund that provides $1.008 per share in annualized dividend stream ...that implies a forward looking 10.2% yield.
In calendar year, 2015, ETY DELIVERED a Total Return of + 9.92% versus the S&P 500 index Total Return of +1.31% ...My on-going contention is that this impressive out-performance is largely missed or ignored as the typical brokerage statement does NOT report Total Return ...preferring to show the $11.22 per share starting price on 1/01/15 and the $11.20 year end price ...essentially a flat to negative performance during 2015 ...except that , with dividends reinvested, the owner has almost +10% more in value than at the beginning of the year ...
The fund EASILY earned its dividend stream in fiscal 2015, according to their annual report, utilizing ZERO Return of Capital and paying the rough dollar per share from invetment income and realized capital gains exclusively.
ETY has been averaging a trailing five year rate of return of + 10.34% ...NOT too shabby for a mutual fund and especially important in view of the dismal investing year of 2015 and the horrible start of 2016.
The fund holds ONLY 55 stocks ...with Apple, Google, GE, DIS, Visa, Gilead, Amazon, J&J ,JP Morgan, and Danaher composing 32.5% of the entire fund ...!!!! and now on SALE for approximately 10% discount to their Friday closing value.
Move ETY to the top of your WISH LIST ...get PAID while you wait for a recovery ...10% is good ...lol ..
Hope this proves helpful -
ETY continues to outperform the benchmark S&P 500 index in a meaningful way - + 7.95% ytd with two additional dividends scheduled to be paid in 2015. Realistically ...we can anticipate a total return of about 10% for the calendar year as compared to the index which will likely finish around + 5% for the year.
NAV has IMPROVED + 5.36% for the year ...and the fund has used ZERO Return of Capital to make the high monthly distributions, preferring to utilize 80% long term capital gains to earn the dividends.
The fund is trading at a ( -7.33% ) discount to NAV at this writing with a 52 week high of $11.96 per share and a low of $9.95 per share ...
The fund started 2015 priced at $11.22 per share ...and is around $11.25 today ...
That is potentially important because many investors will be " shopping " their portfolios for year end tax losses to take advantage of the $3,000 capital loss deduction that current tax law allows holders to take each calendar year ...
My contention is that a small but significant number of investors will DUMP ETY prior to year end and because the way portfolio statements are reported ...many will believe that ETY has UNDERPERFORMED or done very little in 2015 ...This belief just tends to hammer mutual funds at year end ...but Closed end funds are specifically prone to 4 th quarter sales ...
Consider a logical " Good deal " price for ETY ...as I am projecting that we will get something very temping in the coming weeks ...
With a current NAV of $12.14 ...and a discount of -7.33% ...a slightly larger discount of say 10% would impute a $10.92 market price ...
A general market " bad day or week " would likely drive down the NAV to the $11.50 range and applying a round 10% discount ...suggests a $10.35 market price ...which we actually saw on 8/24/15 and again on 9/29/15 ...
The investment thesis being that the new year will rapidly see a quick recovery in the market price ...at least back to the $11.25 present level ...
Buy at $10.35
From my earlier post on Sept 5, 2015 :
ETY - on a YTD basis has a Total return of + 2.16% versus the S&P index of ( 5.38%)
I was speculating that any market recovery in the fourth quarter of 2015 would prove VERY beneficial to the market price of ETY, particularly since the small positive YTD Total return of + 2.16% thru 9/5/15 was much better than having to make up the ( 5.38% ) negative Total return of the benchmark index over the same timeline.
Ok ...Its 10/19/15 at this writing, and here are the Total return results as measured by Dividend Channel and annualized thru the end of 2015:
ETY - + 7.71% with dividends reinvested and annualized for the 2015 calendar year at + 9.84%
S&P 500 Index - + 0.40% thru today with dividends reinvested and annualized at + 0.51% for the 2015 calendar year ...( ouch )
Wait ..what does this really mean ?
ETY is likely ( barring another market meltdown prior to 12/31/15 ) to produce a +10% Total Return for the year ...The popular S&P 500 benchmark index will likely be producing an anemic money market like return of + 0.51% ...
We shareholders of ETY, a long suffering bunch in many cases, looked to be VINDICATED by 2015 ...earning + 10% and cumulatively + 22.08% over the past 1.78 years of duration whereas the index delivered + 14.96% over that same timeline ..a 716 basis point difference in favor of the Eaton Vance fund.
When your fund is punching out +10% year over year , especially when the market is " frothy" and subject to big Up and Down days ... ETY has proved itself as a dependable , monthly income and appreciation fund.
Simply stated ... We have + 22.08% MORE money in present value than we had just 1.78 years ago ...For Mutual Fund investing ...with big cap stocks and defensive index Call options ...That's about AS GOOD AS IT GETS ...
Hope this proves helpful ...your comments always appreciated ...Thx
paulstutz - Thx for the note ...for some unknown reason Yahoo was deleting my ETY update posts , especially the semi annual report update ...Oh well
I just posted a quick performance review on the ETY message board ...hope it helps ...
I continue to hold and reinvest dividends in ETY ...as I think the investment strategy is really good for this crazy / uncertain market ...and the monthly dividend stream can solve a lot of performance anxiety ..lol
Thx - mike
With the carnage in the equity markets and August end brokerage statements out in the mail and sure to cause great consternation; here is a little perspective to keep in mind BEFORE making the decision to tell your mutual fund managers ...' YOU'RE FIRED "
ETY is a stock based fund that SELLS S&P 500 index CALL options each month ( thousands of contracts ) to hedge against sudden market downswings ...the idea being that as the value of the stock portfolio declines rapidly , the value of the CALL options will INCREASE dramatically ...In a great upward moving market; the investor will see ETY under perform stock indices such as the unmanaged S&P 500 , but in a turbulent market, one filled with -300 and -400 down days ...funds in this Option Income sector should do ok ...( NOT great , but not destroyed either )
OK - lets see how that has worked out in reality by measuring Total Return as calculated by Dividend Channel with dividends reinvested.
ETY - on a YTD basis has a Total return of + 2.16% versus the S&P index of ( 5.38%)
ETY on a trailing 1.67 year basis ( Jan 2014 -present ) has a Total Return of + 15.79% versus + 8.34% for the popular index.
Look ..Getting a tiny positive Total Return of +2.16% after an eight month investment duration sure does not sound like much, until you consider the S&P 500 index holders ...down over 5% on a YTD basis and facing the mathematical reality that they will need to get a +10% performance from the index ...JUST to get back to break-even from Jan 1, 2015 ...whereas holders of ETY stand to participate in an market recovery without having to make up for losses on a YTD basis. ( That's BIG , in my opinion )
NAV performance - ETY is trading at a comfortable -5.67% discount to NAV whereas many funds in the closed end universe are at double digits ...( AOD - is trading at a whopping -15.18% discount to NAV )
Summary - Continue to HOLD and Reinvest dividends ..but NOT a compelling BUYING opportunity here
Excerpted from the 4/22/15 shareholder meeting bulletin -
percentage of ownership based on 16,137,898 shares outstanding as of 4/15/15:
Seth Lederman - 621,183 shares or 3.80% of the company
Officers and directors own 1,544,612 shares or 9.21% of the stock ...
Deerfield Special Situations fund, Broadfin Capital and Technology Partners hold an aggregate 3,700,886 shares or 22.73% of the issued shares ...
Dr Lederman also holds a series of stock option grants struck at various prices ...Ex- 30,135 option shares@ $30 per share expiring 5/9/22 , 41,250 option shares @ $10.20 expiring 2/12/23, 71,000 option shares @ $15.88 expiring 2/11/24, 100,000 option shares @ 9.87 expiring 6/17/24 and another 100,000 option shares @$6.88 expiring 10/29/24 ...
Dr Lederman earned an aggregate $2,853,578 from TNXP in 2014 ...( whew ...that's high )
Ok ..I like the fact that the "insiders" and officers of the company are knee deep in TNXP shares ...it demonstrates commitment and belief in the company and concept of business going forward ...The large amount of out-of-the-money option contracts that extend thru 2024 also reflect that the corporate officers and insiders are taking some of their compensation in $30 stock options, $15.88 stock options and $9.87 stock options ...which are essentially worthless unless and until the market price of TNXP passes thru the option strike price ...and then they begin to take on a value that can be cashed in. ( taxes and paying for the options themselves suck up a lot of the cash ...so, for example, a $30 stock option needs to be market trading significantly ABOVE $30 for it to have serious value ...)
This are all BULLISH indicators for TNXP ...and might even explain the comparatively low volume in the public float ...( a large percentage of shares are being held by insiders and investment venture capital firms who are looking for a huge return, far from day trading or short term trading TNXP )
Hope this proves helpful
Sentiment: Strong Buy
I have a close friend who has been a long term diabetic and has been using the insulin pump and monitor ...This friend has been following Afrezza and doing her homework to include contacting Sam Finta, and others. She visited with her PCP and ENDO , who are both well respected and conservative in her community.
Initially, there was not much information and both physicians expressed their reluctance to jump on something so new and unknown. ( here in Texas, medical malpractice lawyer commercials seem to run about every 10-12 minutes on the TV , weather we need them or not )
That has ALL changed over the last 3-5 weeks as both physicians have been contacted by Sanofi reps and her Endo knew exactly how to refer her for the lung test ...and what to do when the results came back ( 1-2 days )
Here is a portion of her e-mail to me this afternoon ....
After getting two calls today from my doctor's office that I had passed the lung test and that they would send a prescription to my pharmacy for the Afrezza and then a call to tell me after I received the Afrezza to make an appointment to come to the office for training (they are in training now, I will be the first patient), I called my pharmacy and they said they can't get it. Their wholesalers don't carry it. I called Walgreens (which I hate to do) and they said that they could have it in the next day. I need to check with my insurance company first and see what this is going to cost. Anyway, looks like I'm good-to-go!
Summary - Her Endo and his office staff are themselves IN TRAINING , Walgreens reports a one day delay in filling Afrezza prescriptions , her Endo provided her a discount card for a FREE initial prescription and a $30 refill until the promotional period ends.
It appears that Sanofi DOES in fact have a significant marketing development program in process ...and are actively TRAINING groups of ENDOS and PCPs.
This says a lot of good things to me ...hope you find it helpful.
A friend recently visited her Endo and received a prescription for Afrezza after a detailed consultation and lung test.
The doctor ALSO issued her a prescription discount card with Sanofi's logo imprinted on it that offered the first month of Afrezza for free and subsequent refills at a maximum cost ( when coordinated with insurance coverage of $30 per refill )
The discount states that this program will last an unspecified time or until Sanofi decided to stop it.
Ok , if this one Endo is fairly typical of specialists in the diabetes treatment arena, and he has a pad of major league discount coupons to issue to his patients along with their Rx; would this explain why the sales volume number came in so weak ?
Why would anyone pay for an Afrezza prescription when they can get the first 30 days for FREE ? and subsequent refills for a maximum of $30 ?
While pondering that question ...consider if the discount coupon campaign is proof of at least a minor campaign on the part of Sanofi to market the inhaled insulin ....something that many posters here have been asking for ???
Finally ...my friend was at her PCP office earlier this week , in Ft Worth, Texas ...and the PCP mentioned in passing that he was attending a local meeting / conference sponsored by Sanofi with the sole item on the agenda being ..( wait for it ) ...Afrezza. He also stated that he expected to see her Endo there , along with a bunch of other interested physicians.
Perhaps they are attending the dinner / conference with the express purpose of consuming the jumbo shrimp and white wine spritzers ...but...at least Sanofi is trying to get their attention far beyond the 10 minute "grip & grin" sessions allocated for the doctor's offices on Tuesday and Wednesday mornings ...
Feels like the roll out of an advanced marketing program ....( can only hope )
AOD is trading right at $9.01 per share at this writing and with an NAV of $10.51. That's the basis for the performance review.
First - the discount to NAV is -14.27% which is compelling in of itself, but lets look at how the NAV has performed over the last six months or from Oct 15,2014 when it was quoted at $9.27 here on Yahoo.
The NAV or underlying value of the stocks inside the AOD portfolio has INCREASED by +13.38% ...That is certainly a very healthy indicator and frankly one we have not seen much of from this mutual fund over the past 4-5 years.
Total Return Performance - Trailing 1.3 year period Vs the S&P 500 with dividends reinvested = +20.25% for AOD and +17.34% for the S&P index.
YTD performance - AOD - +7.01% Vs the S&P 500 index - +2.68% ( that works out to a 433 basis point jump on the popular S&P index in a bit less than 120 days of duration )
Maybe, just maybe, we are FINALLY going to get a Top Performance year from the new managers ( 3 yrs on the job ) at AOD.
AOD has legitimately EARNED it's reputation as the scourge of the mutual fund industry with a split adjusted $40 IPO price and, at times, a seemingly out of control portfolio turnover rate of 600% + each year which eliminated the term INVESTMENT DURATION from its language ....as there practically was none. Even with Apple as one of the top holdings ...you have to hang on to it to make any money ...and they just preferred to trade it ...
The new managers have increased the dividend, reverse split the stock, reduced portfolio turnover to a more rational level, launched a share buy back plan ....and most importantly improved the NAV and overall market performance to habitable levels. They may have turned this ship around.
Their six month fiscal year report thru April end 2015 will make for interesting reading ...
As a long term holder ( did some tax loss selling in 2014 -ouch ) and frequent critic of Alpine management; I just have to say ..they have done well on a 1 yr and ytd basis
Just recall that equity options typically expire worthless ....with the majority of buyers and sellers simply closing out their respective positions rather than wait for expiration or auto exercise of in-the-money contracts above $0.25 ( check that ...but it used to be the trigger number for auto exercise years ago ...lol )
I vaguely remember that open and closed positions were much easier to account for to the IRS ...and several popular tax programs ( H&R Block ) didn't compute expired worthless options very well. You also don't have to ADD the options premium taken in to the Strike price on exercised Calls to compute proceeds or similarly subtracted from exercised Put contracts ...to determine cost basis ....a difficult and time consuming project if you were playing the options market more than a few times each year ....( Accountants love to charge more for those computations )
Above all ...why take the risk of some wacky day in the market or some extraneous event that might destroy a profitable options position ...Control your gain / loss by closing an open position ...and perhaps initiating a new longer term one. If you only have $0.14 of value left on a position you paid $1.00 for ...CLOSE it out ...take the cash ...start again ...
Just because most options expire worthless ...does NOT mean they are corrupt ...perhaps just being managed correctly.
hope this helps - regards
reply to orin_scrivello :
That $0.11 per contract sure sounds tempting ....for an approximate three month duration ....and you would need a $5.92 per share market price increase to reach the strike price and $6.03 per share to reach B/E ( rough calculations without any commissions figured in ) ...an 85% increase in a bit less than 100 days.
Perhaps a better question is ...who the heck is selling these contracts for $0.11 per share ? Recall that there must be a Seller for every Buyer and the CBOE just matches them up ...Be careful that this $0.11 price is NOT just a number derived from some complex mathematical formula ...generated by the options program for representative pricing ..Look at the open interest and last trade data ...and see if anyone has been filled anywhere near that price ...I was thinking about selling some out-of-the money covered calls to generate a little portfolio income ...but there is NO WAY I would accept $0.11 as a reasonable option premium ...even with a $13 per share strike price ...and risk losing out should a buy out opportunity actually take place.
It might be better to pay a little more premium and BUY the longer duration Calls ...that way you would get several additional months for news and in specific the number of RX written since the late Jan launch of Afrezza ...and a better idea of how the physician community is or is not accepting the inhaled insulin product.
That chump change of $1,100 could instead buy you about 155 shares of the common ...to add to your existing position .....and if the market price does in fact jump to $10 -$13 per share ....the options premium you could take in from Selling Covered Calls against the position would necessarily jump as well. ( dramatically I would imagine )
Summary - tempting ...but NOT tempting enough for me at least ...will continue to add " chump change " amounts of common stock to my existing holdings ...essentially dollar cost averaging additional shares each month ...Regards
Hello and thanks for your comment / question ...
Reading from page 15 of the fiscal 2014 annual report dated 10/31/2014 and audited :
2014 portfolio turnover - 99%
2013 portfolio turnover -192%
2012 portfolio turnover -310%
2011 portfolio turnover -367%
2010 portfolio turnover - 487%
My memory is a bit hazy but I believe I saw that 58% number you referenced on the semi-annual report thru April 2014 ..but that was NOT annualized ...hence the 112% number I projected on AOD for the fiscal year. ( was off a bit - LOL )
Dividend capture style funds will typically have much higher portfolio turnover percentages ...but the overall stock market was decisively moving up in 2010, 2011, 2012 and 2013 ...and my contention is that by rapid fire trading in the 300-500% annualized percentage area ....AOD essentially completely missed the general market recovery ...
The four year period between Jan 2010 and Dec 2013 saw the unmanaged S&P 500 produce a total return of + 76.18% or +15.24% per year ...
That same four year period ( 2010 -2013 ) saw AOD produce a ( -21.73% ) Total return or ( -5.95% ) per year ...
That underperformance is simply damming ...and I think it reveals the fundamental flaw with " capture " funds with high turnover ...They don't have a holding period or duration of investments that allows them to see significant asset appreciation ...Example - Apple is the biggest holding of this fund at over 2% ...and has been for years ...but they cant seem to book much of a profit on selling the shares ...my guess is that fund management has been dumping shares of Apple and re-buying them 10 -20 times over the past five years ...perhaps more ...( just a guess )
As a result ...they missed a plus 300% price increase on their singe biggest holding ...in effect ...they make a few bucks ...but by rapid fire / high velocity trading ...they missed the huge market price upswing with Apple.
Hope this proves helpful - Thx for comment / question - Mike
Good point ...as the earlier comment I posted was taken from the audited 2014 ETY annual report for the fiscal year ending 10/31/14.
The best data available on Total Return from Dividend channel including reinvested dividends from Jan 01, 2014 - Jan 16, 2015 ( call it a little better than one year of duration ) illustrate a Total Return from ETY at +12.43% as compared to the S&P 500 index with a +12.38% Total Return over the same period.
Most closed end funds got " TRASHED" with December tax loss selling and the uncertain market during those weeks ...causing the market price to slide significantly lower ...
The hope here is that fairly significant loss per share will be made up quickly as the market seeks to adjust to the suddenly much larger discount to NAV , the new year begins and folks orbit back to the large monthly dividends ....( tax advantaged )
But the simple truth is that we have + 12.43% MORE money in market value than we had 12 months and two weeks ago ...That makes it worth holding on to ...
Hope this proves helpful
forward capital losses from 2008 / 2009 ...)
ETY also showed that fund management is continuing its share buy-back plan ...they reported that 140,000 shares of ETY were effectively " retired " in 2014 at an average discount to NAV of 10.56% ...It would seem that when the discount to NAV reaches the +10% level ...fund management will be aggressively buying the shares in the open market ...( current discount to NAV is around -8.7% )
Summary - This seems to be a smart well run fund coming off two consecutive years of strong market performance ...Their CALL option tactic is more defensive than simply owning the S&P index but in flat to uncertain / down markets ( uh ...like these days ) the fund seems to do very well in terms of market price appreciation while providing a strong monthly income stream.
Someone once said ..." Its always wise to get paid ...while waiting for market appreciation " ...and ETY seems to fit that description very well.
Hope this proves helpful - regards
The print copy of the fiscal 2014 annual report on ETY had a good bit of interesting data and here is my take on the fund thru 10/31/14.
Overview - Fund has a bit more then $1.8 billion in assets concentrated in only 60 large caliber / blue chip type stocks ...Google is 4.1%, AAPL is 4.1%,Corning is 2.7%,Merck is 2.4%, Amazon is 2.3%, CAT is 2.1% ..you get the idea ..ETY is overwritten with S&P 500 index CALL options about 47% of the portfolio giving them some downside protection in sudden market declines and portfolio income from the options premiums taken in ...they typically SELL the index calls with about 17 days average duration ...and close out the vast majority before expiration ...In fiscal 2014 ..with the market advance thru Oct ...they got clobbered with the options losing approximately $23 million ..BUT...that is ok as the underlying market value of the stocks in the portfolio greatly exceeded the loss in the options area. The fund is showing a net unrealized appreciation in fiscal 2014 of +$173,695,981 and an overall +$222,120,871 in net assets ... both very good numbers and a sign of positive health for the fund.
For Fiscal 2014 ETY posted a + 19.41% rate of return as compared to the S&P 500 index of +17.27% so a nice year after posting a +25.53% return in 2013 and +15.99% in 2012.
NAV - The fund improved its year end NAV by a raw +0.47 per share or 3.9% and hopefully muting some of the critics who have complained that the large amount of ROC in the monthly distributions was in effect robbing the NAV of the fund. A quick back of the napkin calculation indicates that approximately 67% of the fiscal 2014 dividend distribution was ROC.
Portfolio Turnover decreased to 83% from 130% in 2013 as the fund reduced it overall number of stock positions while taking significant profits ...( 2013 was an unusual year in that the fund sold off virtually its entire portfolio ...took a huge capital gain ...and cleverly washed those long term gains against carry ---
After reading a number of posts here about weather or not Afrezza had been approved for insurance reimbursement from a number of the large carriers such as Kaiser , MediCal and BCBS; I wanted to get confirmation and just the basic facts. A couple of days ago I sent an e-mail to my insurance company, BCBS Texas asking for their response and they replied earlier this am ...Here is the scoop:
Afrezza is definitely on their " Covered " list for the 4 unit & 8 unit powder -90 each per month as a " Non Preferred brand Tier 4 ...
The cost data indicated that " Plan Limitation Exceeded " / generic equivalent not available. A further note indicated that my health plan may require quantity limits and that the physician may have to submit an exception request form for approval along with a form link ...
The Reimbursement section - Total cost / plan cost / Your cost tab was BLANK with the check mark indicating that all medicines in this specific request were " covered " ....
OPINION - AFREZZA is officially covered by BCBS TX ...but the earlier posts claiming a " zero co-pay " may be in error or at least premature.
I asked the CVS pharmacist about the co-pay data ...and he advised that he, at this time at least, had no cost sharing information. He was well aware of Afrezza and stated that he had received several inquiries about it.
The importance of being approved for prescription reimbursement cannot be understated and is a huge success / victory for SNY / MNKD ...but the missing piece of the puzzle still seems to be pricing information.
Where exactly they price and reimburse for prescriptions for Afrezza may well dictate the penetration the new insulin delivery system can have in the market or its popularity / usage among the diabetic audience it was designed for.
As Jack Webb used to say ... " Just the facts ..sir " ...and I hope this basic research effort proves helpful.