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Global Diversified Investment Grade Income Trust II GIIZF

Global Diversified Investment Grade Income Trust II is a closed-end income trust. The company provides an economic interest in an equity tranche of a credit default swap agreement. It offers services such as portfolio management, financial planning, tax planning, banking solutions, insurance products and annuity, and complementary services among others.


GREY:GIIZF - Post by User

Post by JReynoldson Dec 16, 2011 5:36am
368 Views
Post# 19327934

My thoughts - all is not lost in GII.UN

My thoughts - all is not lost in GII.UNAs I found the ann't and read it closely, I am, in a way, happy to note that it's not a total loss for the existing investors, and the fund called GII.UN has not been totally closed down. The fund is still being traded on the TSX, and crumbs are still being handed out as dividends, which is, of course, better than if the fund has been clsoed down and we lose all of our money, let along enjoy anymore dividends.

Some analytics on my part :-

1) Credit Exposure Set C is still holding up, and the credit event 2 years caused losses that were not serious enough to cause the value to drop to zero, unlike Sets A and B. If an 'exposure set' can hold-up during the harsh conditions back then, it wouldn't have any problems now.

2) The rating companies have been spending a lot of time downgrading governments and companies lately, this seems to be the in-thing today.... a downgrade will cause an entity not be able to borrow money easily, and if her cashflow is not strong enough, then it will default, causing DB to come in again.

Fortunately, only 10% of the entities inside set C are rated 'D', the rest are higher. Chances are the other 90% will hold-up.

3) For investors with deep pockets, they can take the risk of doing an average-down now.  Total Dividend dropping into their pockets will rise again after that though the DPU has been cut drastically.

Anyway, what I am driving at is ALL IS NOT LOST. And this is certainly good news. I am satisfied,... personally, I was thinking earlier that DB would take everything back and this fund will be closed down totally.
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