Looking at the holdings at the end of October there is an indication the managers may be 'dividend washing' to maintain the yield. This may go some way explain why the dividend yield on the fund is so much higher than that of the underlying shares. It also goes some way to explain the weak capital performance.
Come on people in HFEL land everyone was telling me I do not know how to count or do percentages or how the read the management report.
This company has been going for more than 15 years since 2007. The name was changed but the portfolio was still run by the same management team and the same company.
This was a very different company when it was run by Micheal Watt. Anybody remember him?
I have not bothered monitoring the portfolio further for a couple of reasons. Because the holdings are foreign it is not easy to find a site that will host the portfolio without paying a subscribtion. If anyone knows one perhaps you can let me know. Secondly my opnion has not changed sice my first postin you are all welcome to your opinions.
At the very least dividend growth is likely to slow IF the near 24p dividend can be maintained returns will be healthy.
Gerry
Dividends come at a cost especially large ones.
Rio and BHP are paying a substantial special dividend.
In Financial markets there is no free lunch.
Some of you may have noted that the iron ore price has crashed from $220 to $104 currently and the implications this has for future dividends of these shares. The iron ore price may recover but it highlights the risk.
adeg1
Some good analysis there my friend.
If that turns out to be accurate the NAV per share will increase by more than the buy backs.
Requires some trust and skill by the managers.
History has not been kind to buybacks by UK financial stocks.
Directors have been buying which is a good sign.
Certainly there is a lot of hope.
Personally I would rather take cold hard cash and reinvest myself if I consider the stock to be cheap.
Like to know you views, I see it as management pumping up the share price to pad their own returns rather than returning cash.
Many companies buy back their own shares when times are good = higher share prices and have rights issues when times are bad = lower share prices.
It is not what i like to see from the managers but most companies are doing it these days.
Zac
There are ways of increasing the earnings of HFEL beyond that of dividends paid by underlying companies. The two are not the same which is why reported earnings cover the dividends paid by HFEL.
For the sake of everyone's sanity it is surely time to put this subject to bed.
Zac if your interest is genuine email me to continue the conversation ade2a2000@yahoo.co.uk.
Yes it is an interesting topic. If interested I can go through it with you email me.
Zac
I have quoted my sources many times in previous posts.
If you genuinely interested do not take my word.
Check the yields on the stocks held by the fund yourself. If you do not want to and don't agree with my analysis this is your prerogative.
Gerry has challenged me among others many, many times and I have responded.
To all,
Sorry but Gerry has been repeatedly asking me the same questions.
To Zac,
Thank you for the question.
I do not know exactly how big the shortfall is but it appears to me the gap is closing.
You may be aware that BHP and RIO two large holdings just doubled their dividends.
We can have a watchlist and monitor the yields for those who are interested.
If you do not have anything to ask I have nothing more to add.
New topics can be started on a new thread.