Join today and have your say! It’s FREE!

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.

or

Sign In

Please Try Again
{{ error }}
Password Hint : {{passwordHint}}
Forgot Password?

or

Please Try Again {{ error }}

Send my password

SUCCESS
An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.

Life & Banc Split Corp T.LBS

Alternate Symbol(s):  LFBCF | T.LBS.P.A

Life & Banc Split Corp. (the Fund) is a Canada-based mutual fund company. The Fund's investment objective is to provide holders of Preferred shares with fixed cumulative preferential quarterly cash distributions and to return the original issue price on the maturity date, and to provide holders of Class A shares with regular monthly cash distributions and the opportunity for capital appreciation. To achieve these objectives, the Fund invests in a portfolio comprised of common shares of approximately six Canadian banks and four publicly traded Canadian life insurance companies. The Fund also writes covered call options and cash-covered put options in respect of the portfolio to generate additional distributable income for the Fund and/or to reduce the volatility of the Fund. The Fund's investment manager is Brompton Funds Limited.


TSX:LBS - Post by User

Comment by Obscure1on May 30, 2022 5:34pm
181 Views
Post# 34718255

RE:RE:RE:RE:POS

RE:RE:RE:RE:POSOne more thing in regards to ENS.

I think Middlefied did 5 new issues in 2021 and every time they did an issue, the share price of ENS would drop about $0.80 as I mentioned in the prior post.

The game was great for Middlefield as they kept increasing the asset base of the total fund (common and prefs) which produced bigger and bigger fees (0.6% of assets under management). 

Eventually, the holders of ENS came to the realization that paying large premiums to the NAV for ENS was stupid because the shareholders kept taking it on the chin with every new distribution. 

Now, ENS trades at about a 5% discount to the NAV.  At a first glance, it looks like Middlefield were being greedy, but in reality, they were only taking advantage of ENS investor greed and stupidity in paying the large premiums to the NAV.

By keeping track of the live NAV and the daily share price of LBS, you always know the premium.  As you keep track over time, you learn the trigger points when the fund manager will issue new shares.  Knowing the trigger points allows you to sell and get out of the way just before the new issue.  Then you can buy back in as the share price drops off more than it should. I did that for a few rounds with ENS but then I got to the point where I didn't think ENB was back to being fully priced. 

I'm not in love with the bank and lifeco's as the total return (capital gain plus dividend) is solid but unexciting.  However, rising interest rates typically help the finco's and the leverage of Splits can produce superior returns when the going is good.  I just want to know when to step aside before new share issues.  If nobody is keeping track of the live NAV, I guess I will have to do it myself which I was hoping to avoid.



either the brokers who were putting away each tranche to their unsuspecting clients in exchange for abnormally high commissions, or
<< Previous
Bullboard Posts
Next >>