Dividend 15 Split Corp T.DFN

Alternate Symbol(s): DFNPF | T.DFN.PR.A | DVSPF

Dividend 15 Split Corp. is a Canada-based mutual fund, which invests primarily in a portfolio of dividend yielding common shares, which includes approximately 15 Canadian companies. It offers two types of shares, including Preferred shares and Class A shares. Its investment objectives with respect to Preferred Shares are to provide holders with fixed cumulative preferential monthly cash dividends in an amount of $0.04583 per Preferred share to yield 5.5% per annum on the $10 repayment amount and to return the $10 repayment amount to their holders on the termination date. Its investment objectives with respect to Class A Shares are to provide holders with regular monthly cash distribution targeted to be $0.10 per Class A share and return the original issue price to their holders on the termination date. The net asset value per unit must remain above the required $15 per unit threshold for distributions to be declared. Its investment manager is Quadravest Capital Management Inc.

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Dividend 15 Split Corp > NAV

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Comment by AnEducatoron Jul 12, 2023 1:23pm

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Post# 35537752

RE:NAV

Despite the close proximity to the payment threshold, I find it stunning that people are willing to pay $6.61 for shares whose value is only $4.93, especially after the carnage everyone has witnessed the last couple of days. Did people not learn anything about the potential risks once the NAV has fallen to these levels?

The downside risk here is immense, even if DFN happens to declare a distribution next week, which is still very much in doubt.

AnEducator wrote: Currently around $14.93. Huge bounce from yesterday's close with the NAV only around 0.54% off the payment threshold of $15.01.

Someone here correctly inferred that in order for a dividend declaration, the NAV has to exceed $15.00, and I can confirm that as per the prospectus:

No regular monthly dividends will be paid on the Class A Shares in any month as long as any dividends on the Preferred Shares are then in arrears or so long as the net asset value per Unit is equal to or less than $15.00.