Anybody losing their shirts in this market? (fees, dividend, invest)

[wp169]

Originally Posted by mathjak107

No bond funds are stable now and all are at a loss ….what fund are you referring to?

My bond fund is in a downturn now like the rest of them, but I'm still getting my 10% distribution check every month waiting for it to go back up again. My retired neighbor says even his money manager doesn't get his equity portfolio up to 10% annually!

I don't want to name the fund because if someone buys it on my recommendation I would feel guilty if they lost money, closed end fund data needs to be researched so the fund will be purchased at the right time.

I bet short sellers are making loads of money in this downturn!

[mathjak107]

Take a look , I bet that 10% is subtracted right of the value of the share price when it goes ex div …

It is likely paying you zero return or less and just going deeper in the hole no different then selling the same dollars out of a portfolio.

If you want d/m me the fund and I will tell you what you are really getting.

To think one can pull 10% out of a portfolio because that is what is being handed back to you in a down market with no nasty repercussions is a myth.

I will bet you don’t fully understand how things are working just from your description above

[wp169]

Originally Posted by mathjak107

Take a look , I bet that 10% is subtracted right of the value of the share price when it goes ex div …

It is likely paying you zero return or less and just going deeper in the hole no different then selling the same dollars out of a portfolio.

If you want d/m me the fund and I will tell you what you are really getting.

To think one can pull 10% out of a portfolio because that is what is being handed back to you in a down market with no nasty repercussions is a myth

When the fund goes back up to the price per share I paid for it, where is the loss?

[mathjak107]

If it goes back up ..

Suppose it doesn’t as it will need rates to get this low again ..,


Or maybe it won’t rebound at all because I bet each 10% payment is reducing the value of a share by the same amount with each ex. Div date.

It reaches a point like a reit I owned where it can never get caught Up ..it payed out to much and took to many reductions for the pay out .

This is two decades later and the reit has not reach its purchase price as share values fell so much over the years from the high payout.

I sold it a decade ago .

Some closed end funds pay rates like 10% but it includes principal too so the share value will eventually hit zero and you are still at a loss .

No one can pay 10% out today without consequences in share price reducing more and more

[mojo101]

If his closed end fixed income fund goes down in price,it is not because it pays him a dividend,it is due to rise of interest rate.
I recall folks who bought uncle 's 5% saving bond when rate keeps rising,but they hold on to it til maturity and get their original principal back.
(of course,that original principal no longer has the same purchasing power due to inflation and that 5% interest is no match to some one who bought bond yielding 8-10% ).
But in time of deflation,it will be opposite.
This is what happens in Japan,retirees who get a fixed pension check each month find out they can afford things they cant afford before,like fancy edibles.

[mathjak107]

Originally Posted by mojo101

If his closed end fixed income fund goes down in price,it is not because it pays him a dividend,it is due to rise of interest rate.
I recall folks who bought uncle 's 5% saving bond when rate keeps rising,but they hold on to it til maturity and get their original principal back.
(of course,that original principal no longer has the same purchasing power due to inflation and that 5% interest is no match to some one who bought bond yielding 8-10% ).
But in time of deflation,it will be opposite.
This is what happens in Japan,retirees who get a fixed pension check each month find out they can afford things they cant afford before,like fancy edibles.

Not true ..most closed end funds have an automatic share price drop to match what was paid …they also tend to return principal reducing value .

Unless he sends me the fund you have no clue what they do


https://www.fidelity.com/learning-ce.../distributions

[mojo101]

Back in early 1980s,there is a bond salesman in our condo building,he is trying to sell a highly rated muni bond with a 15% interest rate,minimum investment $5000.
He lamented no one has $5K,altho most residents are professionals and both husband and wife work and have no children.
15% tax free,where can we find such investment these days?Puerto Rico??

[Mikala43]

Originally Posted by mojo101

Back in early 1980s,there is a bond salesman in our condo building,he is trying to sell a highly rated muni bond with a 15% interest rate,minimum investment $5000.
He lamented no one has $5K,altho most residents are professionals and both husband and wife work and have no children.
15% tax free,where can we find such investment these days?Puerto Rico??

Ibonds are currently 9.62%.

[mathjak107]

Guaranteed that poster is getting principal payments and getting back his own money as it is subtracted off the remaining value and he is just confused as to how things work

[gentlearts]

We lost $8000. last month, but we understand that it’s just something to ride out.