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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (95783)5/2/2002 4:45:22 PM
From: Tommaso  Read Replies (1) | Respond to of 132070
 
So probably the fund is leveraging junk bonds at current short-term low rates?

What a recipe for catastrophe! The stock price is subject to:

1. Interest rate risk.
2. Credit risk.
3. Market risk (investor disenchantment).

The minute there's a problem with either of the first two, the return drops, the NAV drops, and to accelerate a decline there's the premium.

A good-as-gold investment. Good as fool's gold, that is.

Or that's how it looks to me.


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