Dividend 15 Split Corp T.DFN

DFN (why are people still buying this?)

[Martincat]

Aneducator, I would venture yield which is very very high...JMHO!

[AnEducator]

I can certainly appreciate the seductiveness of the yield, but only if it is sustainable. Until recently, the NAV of the fund has had plenty of downside cushion, but now, the NAV is hovering around the $15.00 threshold and that makes an ongoing distribution very tenuous.  Note that the fund was issued at $25 and has decayed to $15 over the years despite all of the offerings and market gains

[jeanstk]

Do offerings increase the outstanding shares which as a result will dilute the stock value? Is that what’s going on? DFN now has to many shares at 105m+? I do not fell comfortable buying stocks that has too many shares. My limit is less than 100m. FTN at one point (in my understanding) repurchased shares and increase the dividend a year or two ago?

[mouserman]

Lots of shares out helps liquidity, but what is happening with many of these split funds, is the ATM, which allows  the fund to create shares to sell big blocks to investors at the market price that day . Even if there really isnt that much REAL interest on the market depth. So it is understandable how DFN gets to a 50% premium, but  that CERTAINLY doesnt make it a buy. LCS is a buy

[Mmb060]

Why the concern ? Almost all the money invested in companys with way more than 100m shares.

[pjn0987654321]

The underlying companies are well established with 100 million shares or more.  With DFN, if the NAV falls below $15, then the dividend payment for the common shares is suspended.  The last published NAV, which you can find on the website, is $15.49.  NAV is published every two weeks.  It's the NAV on the 15th of the month or thereabouts that says whether there will be a