Decided I would start up a very few shares of close ended equity mutual fund NFJ. I'm in it for the dividend yield. I would also like to say for the diversification it provides me. However, reaching for yield has cost me dearly in '08, and I'm reluctant now to buy enough NFJ shares to make a significant contribution to my portfolio.
Here's the scoop on [t]NFJ[/t]:
allianzinvestors.com
Essentially these guys operate in a way I don't (thus the diversification for me). They use a call-writing strategy to enhance ("juice"?) yield. They have a concentrated portfolio (concentrated by my standards anyway -g-) of about 40-50 stocks, and they employ price momentum as one of their quantitative metrics.
I like that they have both common and convertible stocks, and from what I understand, screen only (or primarily?) the "... 1,000 largest stocks for low P/E, high dividend yield, and visible earnings".
Two specific positives for me are 1) the annual distribution yield currently (after a recent cut) seems to be 11.7%, and 2)Unlike so many other closed end funds, these guys do not use leverage.
A few starter shares for me. If NFJ drops, I'll buy a little more. |
