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.
Thanks for the reply on my earlier comment on AOD.
To address your question about the performance metrics ; I use Dividend Channel website which has a very useful performance tool that shows the hypothetical value of $10,000 invested on a specific date and the impact of reinvested dividends to compute the Total return of the fund.
AOD produced a + 10.68% Total Return in calendar 2014 as compared to a + 14.56% return for the S&P 500 index with dividends reinvested,
Since March 9, 2009, when I initially invested in AOD ...the fund has a cumulative +107.68% Total Return as compared to the S&P 500 which has a cumulative +240.34% Total Return. That works out to about +13.39% per year for AOD versus + 23.44% for the index.
Its not perfect , but the disparity of performance comparison between the unmanaged index and AOD is frankly damming ...It should also put to rest your contention that the " past few years have been exceptionally difficult because of low interest rate environment."
Alpine brought in two new portfolio managers a couple of years ago ...and in their respective letter to shareholders promised to make significant changes to their investment tactics. Initially they did just that ...increasing the monthly dividend , launching a share buy back plan, reverse splitting the stock 1:2 , reducing the 650% annual portfolio turnover ....increasing the NAV by over +13% in their first year on the job. I was encouraged ...
Then, the latest annual report illustrated that they had completely STOPPED buying back shares ...were once again using a super-heated portfolio turnover in the 112% turnover area ..and incredibly ...were now using leverage or borrowed money to in effect pay the dividend.
This seemed like a radical departure from the April 30, 2014 semi-annual report letter to shareholders and reflected the management decision to essentially not worry about the jumbo level discount to NAV ...and even take on ADDITIONAL RISK .
Enough is enough ...I am OUT.
The hard numbers are in for 2014 and the results show that AOD did poorly as compared to the S&P 500 index with dividends reinvested.
Specifically - AOD produced a + 10.68% Total return whereas the S&P index returned +14.56% for the calendar year.
That is a 388 basis point difference over a trailing 12 month basis ...and an aggregate -10.05% PER YEAR below the S&P 500 index over the past SIX YEARS of the holding period.
Shareholders like me have given Alpine management many years and lots of second chances to get the story straight and start to compete with the unmanaged index.
The new portfolio managers have FAILED to even come close to the index by way of comparison ...after two years of tenure and their upbeat 2013 letter to shareholders promising effective changes ....what a disappointment is the nicest thing I can think to say about them.
Most disturbing was the recent use of LEVERAGE to pay the monthly dividends ...and the complete abandonment of the 10% share repurchase program after only six months of buying back shares.
That sent a message to me that the new managers were NOT that committed to reducing the outrageous discount to NAV as many other closed end funds have done.
This fund seems to be marginally ok in a good market ...and disastrously in a flat to weak market. There seems to be no upside to continue to hold the fund, not even the hope of a good market as they just missed 2014 by 388 basis points ....yet again and similar to 2013, 2012 2011 ..you get the idea.
Used the share lots purchased at a higher price to wash the capital losses incurred against some nice 2014 capital gains earned ...that might be the best thing AOD and Alpine management has done for me ...providing capital losses to offset taxation on most other investments with a gain.
This was ALWAYS a " Run & Gun " dividend capture fund ...essentially the fund bought stocks a day or two before the dividend x date ...captured the monthly or quarterly dividend or special dividend ...then dumped the shares a few days later ....portfolio turnover was north of 650% per year ...they racked up over $3 billion in realized capital losses in 2009 ...on a fund with about $1.1 billion in assets today ...
Your Edwards broker could NOT have executed this trading strategy in any account ...as there is a circa 1929 era SEC / FINRA rule against " Selling Dividends " ...its illegal and the broker would lose their securities license for doing what is also considered " excessive trading / churning " ....
For some reason; its totally OK for a mutual fund to engage in this tactic ...and Alpine's AOD fund was one of the largest initial public offerings in the closed end world when it originated ...during a super hot time in the equity market I seem to recall.
There is little to no investment thesis ...just trade dividends ...and in good markets where there can be plenty of special dividends ...it works after a fashion. In poor to flat markets ...they get absolutely killed ...on a biblical level ...
A little over two years ago; AOD replaced the fund manager and brought in two relatively young guys ...to restore / rescue the fund ...They have had a good equity market to support them and they have built up the NAV of the fund by more than 20% , increased the monthly dividend and are pacing the S&P 500 index within a 100 basis points in 2014 ...they also reverse split the stock 50% ...
AOD may be worth holding on ...if you still own it at this point from the IPO price ( split adjusted $20) to see what 2015 brings ...but ...it is NOT an investment fund ...just a bull market trading tool with high current income.
Reply to weblvr - The cost basis adjustment caused by " Other Capital " or ROC is a very complicated issue with conflicting applications literally from brokerage firm to firm. My two brokerage firms have NEVER reduced the cost basis for ROC on shares of ETY. From this chat board I have learned that other firms DO IN FACT reduce the cost basis ...
Lets take fiscal 2013 for example ...ETY management decided during the last month of the fiscal year to " re-characterize" the previous 11 months of distributions to 100% capital gains from the previous estimate of about 72% ROC ....They can do this in time for the annual report and the major league audit / accounting firm agreed ...then using the hundreds of millions of dollars in 2008 carry forward capital losses to wash against the impressive gains earned during the 2013 fiscal year ....resulting in a NET ZERO capital gains to the ETY shareholder ...
How and when would the brokerage firms have reduced the cost basis of the ETY shares ? at fiscal year end ? , monthly ? ...what an accounting nightmare that would have been ...What if individual investors " manually " adjusted the cost basis data to report to the IRS ? ....well that info would be demonstrably different than the data provided by the brokerage firm ....triggering an automatic review from the IRS audit program ....( Oh Geez )
Eaton Vance has a good website that includes a two page " white paper" on Negative ROC Versus Positive ROC ...ETY produces Positive ROC where the NAV has actually increased about +12% over the last 24 months ...compared to a typical CMO bond that will in fact reduce its value by the ROC delivered each month ...very possible to see $25,000 face value of CMO paper with a current value of $3,600 ...as individual homeowners in the CMO pool re-finance or simply sell the home, closing out the loan.
That is NOT what is happening with shares of ETY. One of the best reasons to own any mutual fund is to let them do the math and accounting.
weblvr - Good question ...and you are CORRECT that a large portion of the monthly dividend is classified as ROC or Other Capital ...except that in 2013 ...zero percent of the total distribution was classified as ROC ...ETY management made good use of the capital loss carry forwards from 2008 to " wash " those losses against a good year of capital gains ...
Subsequently, the fund went back to the normal ROC component of each monthly dividend ...
The fund essentially SELLS about 5,000 S&P 500 index call options against their portfolio each month with an average of two weeks of duration ...then closes 80% of the open contracts before expiration.
The defensive nature of such a large position helps offset the portfolio value in times of sudden market downturn ...( early Oct for example ) and in normal or up markets ...the option premiums taken in by selling 5,000 option contracts helps earn income for the fund. Example - the last six month ( audited ) report showed the fund selling 29,755 call options ...and receiving $45,054,059 in premiums for them ...they closed out 20,500 of the open option contracts and had to pay $31,402,038 to do so ...the remainder simply expired ...with the fund retaining the premiums taken in ...
Options are important to the fund as tax law REQUIRES that the tax treatment of index options, regardless of the holding period be treated as 60% long term gains and 40% short term gains ...likely explaining the " Tax Advantaged " name on the fund.
How has the fund performed compared to the S&P 500 index ?
YTD - ETY has produced a + 12.20% Total Return as compared to the S&P index of +6.81%
Call it a 531 basis point advantage over the unmanaged S&P index ....
Since Jan 1, 2013 or roughly 1.8 years of duration :
ETY has returned + 36.36% compared to + 36.67 % for the S&P index ...
Since Jan 1, 2012 or roughly 2.8 years of duration :
ETY has returned + 65.87% compared to +59.80% for the S&P index ....
hope this helps
Check out the Powerpoint presentation on the TNXP homepage - investor relations - presentations.
News has been a little slow as we await the BESTFIT trial results scheduled for mid-late October ...( hopefully ) ...and this was a nice refresher on the bullet points and overall investment thesis to own the stock.
Summary - They have a solid plan ...and the schedule is laid out in detail ...much of which is contingent on the upcoming Trial results ....One thing that I had missed earlier was that the upcoming test for TNX 102 -SL for the PTSD application will feature a 2.8 mg formula for 1/3 of the subjects , a placebo for 1/3 of the subjects and a 5.6 mg dosage for the remaining 1/3 of the people.
It makes sense that they will want to see if a stronger dosage ( 2x ) has a more pronounced impact on the sleep disorders common to PTSD patients.
They make the case that the opiate and barbiturate drugs currently being prescribed ( roughly a billion dollars in sales last year ) may well be supplanted by TNX -102 SL ...or ...used to augment the existing treatment for sleep disorder common to PTSD. Since TNX-102-SL is NOT an opiate or barbiturate ...and ...since many patients taking those powerful drugs are ALSO taking Ambien or something similar ...the conjecture is that TNX- 102 SL will be actively prescribed as a replacement for the sleeping aids ...the SL formula moves into the blood stream 10 x faster than a pill ...and the low dosage ( 2.8 mg ) comes with fewer side effects ( zombie effect of Ambien for example ) ....
With the stock price falling off a bit today ....I plan to continue to accumulate shares .... hope this proves helpful.
Sentiment: Strong Buy
Yes ...UNNI is definitely in negative territory as you correctly observe ....and that does give pause for concern.
But ...the fund also posted a Total income for the six months ending 4/30 of + $0.745 ...well in excess of the required dividend distribution and a healthy sign ....In fiscal 2013 the fund reported $1.993 in Total Income but they executed a 130% portfolio turnover to realize that large gain ...Thru 4/30 the fund in annualizing approximately an 80% portfolio turnover ...( they also used up their capital loss carryforwards that were on the books - a smart move and very tax efficient for shareholders )
Another point to consider ...ETY is being over written with S&P 500 index Call options to the tune of about 47% of the portfolio value ...fund management can easily INCREASE that over write to 60-70% at their discretion ...and thus significantly increase option premium income to the portfolio on a monthly basis.
This gives the management a soft cushion to accumulate and pay the dividend each month ...I note where almost 30% of the approximate 5,000 Index options they write each month are expiring worthless ... ( they keep the premium received ) and of the remaining 70%; they netted + $13,402,038 over the last six months by simply paying to close the outstanding contracts ....
The Index Calls become much more valuable in sharp market corrections ...( last couple of weeks for example ) and help protect the portfolio value and NAV in uncertain markets ....( uh ...like today ...lol )
Summary - ETY management has a certain amount of monthly flexibility to produce cash / income to the portfolio using a greater percentage of Option over write ...management certainly knows that any announced dividend cut would greatly harm the market price ...they have suffered thru that on several occasions ....They are liquidating about 80% of the portfolio every 12 months ...and that produces about $1.447 Billion in proceeds ..so ...I don't think a dividend cut is coming
Dividend Channel features an input box directly below the list of dividends paid ...it shows the value of $10,000 invested from a specific date of your choosing ...with dividends reinvested ....and you can compared against the S&P or Dow or Nasdaq ...
It provides a " cocktail napkin" or back of the envelope analytic on the Total Return performance of most stocks and closed end funds ...I have found it very accurate in the past ...with only one special dividend payment being accidently omitted on one specific issue ...
Its a great way to benchmark your investments against the S&P index ...and make better decisions about which to retain ...and which to SELL ...
Hope this proves helpful - Mike
Look at the Dividend Channel website or Y-charts for specific Total return data ...
Its a useful tool.
Today ...it is showing a YTD Total return on ETY of +15.24% Vs the S&P 500 index Total return of +9.09% ...
Annualized ..that projects ETY to produce +27.41% in 2014 ...as compared to + 16.34% for the index.
Better put ...the managed fund, ETY, is currently OUTPERFORMING the unmanaged S&P 500 index by 615 basis points in the approximate seven months of 2014 we have experienced thus far ...
After turning in a +28.36% Total return in 2013 ...ETY is continuing to be " on-a -roll " ...
Good numbers for investors who have held on to this fund thru the bad years ...and who are finally getting some solid market return on this issue.
Thanks for your comment ...hope this proves helpful
The BAD - continued :
AOD fund manager's are continuing their ' Dividend Capture ' tactic by buying companies that have been paying large one-time dividends ...then selling ex-dividend ...This seems to have worked over the previous six months ...earning enough to pay the dividend without an issue ...but ...I worry that such a tactic is more opportunistic and short lived ...What if special dividends dry up ? as they always seem to do in difficult markets.
The UGLY -
AOD management indicated that they are BORROWING money ( using leverage ) to execute these special dividend captures ...whoa ...leveraged funds don't just get hammered in bad markets ...they get CRUCIFIED ...upside down no less. The use of leverage ADDS a new dimension of risk to the fund.
What the heck happened to the 10% share re-purchase plan ...?? they executed about 1.7% of the authorized amount ...then stopped completely. That does NOT sound or feel right ...My guess is that without 192% portfolio turnover ..they are running short of cash proceeds from the SELL transactions to be doing much for share buy-backs.
Summary - AOD is now a leveraged / special dividend capture fund with core blue chip holdings in APPLE , Vodafone, Comcast,Qualcomm, Roche, Nestle, Novartis, Covidien and McKesson. Does that sound good to you ?
Its a BULL MARKET fund ...ONLY. Switching to HOLD and Reinvest dividends ...Don't try and ride this one thru a difficult market ..as they can't possibly meet the monthly dividend requirement in that circumstance ... and will be forced to slash the dividend distribution ( yet again ) ...the resulting sell off from furious investors will destroy the market price ...just like 2009 ...all over again.
I wrote on another site that AOD was like a RECOVERING ALCOHOLIC ...could they stay away from Dividend capture as an investment methodology ? The answer is NO ...wait HELL NO ..they are borrowing now money to do it ..#$%$ ?
The new portfolio managers ...seemed unenthusiastic -