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Strategies & Market Trends : Dividend Investing

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To: Paul Senior who wrote (168)	9/13/2002 3:46:51 PM
From: Paul Senior	Read Replies (1) of 387

I'll mention ACAS which has better than a 13% dividend yield. Some discussion on the value thread. Detail pro's and con's (seems to be a short favorite) are discussed on the Yahoo thread. This is a Business Development Company. Which means they don't pay taxes but have to pass almost all of their earnings to stockholders (the dividends). This suggests that for the company to grow they "need" a high stock price so that they can issue stock to get cash for the businesses they fund. Some shorts call it a Ponzi scheme, alleging that essentially the company pays a dividend(and so props the stock) with the cash management got from issuing stock. I own the stock, and have bought a tad more today. I'm not recommending the stock, only describing it here because of its significant dividend. To understand the risks involved it's likely necessary to read and digest some of the discussion about BDC's and stuff like NOI, PIK, etc. that can be found on ACAS Yahoo thread or on a somewhat similar company, ALD. (in which I also have a position) Paul Senior

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