Dividend 15 Split Corp T.DFN

Is it time to enter?

[Tradestay]

Thinking most of the underlying holdings are at their 52 weeks low. If they are to go much further thats a huge problem as we are taling all major banks, Telcom and major energy company. 

The risk Reward is great here given the potential dividend yield buying at these prices plus the capital gain that will follow. 

Thoughts?

[Compypaul]

I'll echo a poster either here or on another split fund board who said their best capital gains have come from buying DFN and others like it when they've stopped paying.  Every time I've convinced myself it can't get worse, it does; but I'm chipping away down here in the knowledge that someday this will be back in the $6-7 range and I'll be making a steady 25-30

[oldbrit34]

I think you are correct Compypaul in what you say plus you are buying at a discount to the Fund's NAV. The possible downside is the length of time you have to hold before its back in the $6-$7 range.

[mouserman]

Ever heard of catching a falling knife? I mean it probably isnt as bad for longs who have an average buy of around 5$, but cant  be that many  of them. Maybe during the pandemic some loaded up.. BUT the ATM machine was selling millions of shares at elevated premiums at times reaching over 40% a few short months ago ...just recently. Those people will need a lot of distributions and

[navgod]

Started buying this week with an average of 4 so far. Will add to position if I can find an attactive short to offset risk. The combination of discount (including that of the pref) and the fact the ATM machine is offline make this a good buy if you are positive or neutral on the market. Given my long held opinion that capital splitshare yield is a red herring DFN is safer than FTN and especially

[tinkvid]

Anyone know what the % is between pref shares outstanding vs Class A shares outstanding and when they have rollback the Class A . I think they have to rollback the Class A once the differential exceeds a certain percentage?

[navgod]

Don't know about any % requirement  but the diff has shrunk from 3.3m to 1.9m since mid aug. Would love to see them buy back some Class A as they now trade at discount but not holding my breath. GLTA

[mouserman]

I read the  original prospectus in documents under DFN on the Quadravest website. Far right dcoument when it pops up. First page shows this "The Preferred Shares and Class A shares (together , "a unit") are offered separately , but will be issued only on the basis that therre will be an equal number of Preferred Shares and Class A shares issued." Seemed the ATM program

[marcrobert]

rollback ?  are we talking about a share consolidation, like 3 for 4, that would result in a higher nav for the A shares (i.e. A nav divided by lower number of shares OS = higher nav per share; on paper?). What's do we mean when talking anout "quadravest's financial situation"? thanks termination is 14 months away, long time

[mouserman]

Their financial  situation is paying out more to commons than they should be if the shares were in equal numbers. SO  basically paid out a few million more $ than if the commons had the same number of shares as preferreds the past 6 months,. Take care of the pennies and the dollars take care of themselves. 

[navgod]

Are you saying that pref shareholders are being ripped off by the capital shares? I hope JB69 is aware if this is the case. 

[marcrobert]

Absolutely, best to buy the A shares sub 5,4, 3  in crises and pick up 200% gains and 30%yields for a cycle. when they top out, you can switch to others that have higher navs and less risk of not paying and crashing, or park in decimated covered call leveraged etfs 

[Couchpilot]

I'm always a little nervous thinking I'm buying at near bottom. I guess because "near bottom" only has meaning retrospectively. Personally I think it all weighs on the boc. I think an October 25th rate hike will send this considerably lower as the telcos and banks are pretty sensitive right now. But I don't think it's as risky as something like BK which is still trading