Opinions
John Hood
Dividend 15 Split Corp.
DFN-T
DON'T BUY
Sep 01, 2017
$10.740
Stock price when the opinion was issued
investment companies
funds
It's the ideal tool to help you make quicker, more informed decisions for
managing and tracking your investments.
You might be interested:
DON'T BUY
Yield of the ETF is higher than the components of the underlying stocks. They split the stock into preferred and equity. They sell options out of the equity version. A lot of investors don't know that there is leveraging that can hurt the price, and a high yield comes with risk.
investment companies
funds
DON'T BUY
DON'T BUY
You get a magnification of performance both on the upside and the downside. So much easier to just buy the individual holdings, collect the dividend, get the capital appreciation, and not pay a fee. Why buy this manufactured security when you can buy the real thing? Doesn't trade well, and you're locked in.
investment companies
funds
WEAK BUY
These companies are hybrids created by the big brokerages and owned by banks like Woody Gundy. They enhance yield by splitting off the growth portion of a stock from the yield-paying portion. Usually, this works, but you're giving up growth opportunities. Fees are involved, though. He doesn't own these derivatives. Not a bad idea for a retail investor looking to increase income.
investment companies
funds
Doesn’t like this and never has. They take bank shares and divide them up, so you have some that are newer issues, the preferreds, and they split off the equity portion. Then they write Calls on the equity portion. You are basically getting the yield from the preferred and the yield from the equity portion, which is in fact leveraged. You have to ask, if something is paying 6%, 7%, 8%, and the highest paying dividend on this is only 4%, where is it coming from? If you compare this against ZWB-T or ZEB-T, they far outperformed this. You’re getting a decent dividend, but you are not getting any performance.