Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Heinz Blasnik- Views You Can Use -- Ignore unavailable to you. Want to Upgrade?

To: Wyätt Gwyön who wrote (939)	5/8/2003 9:25:56 AM
From: Win-Lose-Draw	Respond to of 4907

no she is not. you are confusing a bond with a bond fund.

To: Wyätt Gwyön who wrote (939)	5/8/2003 11:53:09 AM
From: GraceZ	Respond to of 4907

you are confusing yield with total return. Actually, I wasn't but maybe Kerry was. The dividend payment last year was 11.7% which was comprised of cap gains and income. The appreciation (since I use a CEF that trades like a stock where it is sometimes priced at a premium and sometimes at a discount to NAV) was about 11% as well. 22% wasn't too shabby for a fund that has mostly US government bonds. But maybe you aren't aware such animals exist. I've been in and out of this fund since 1987 and the average return over that period is close to double digits, 9.97%. If you are careful to buy it when it trades at a discount and sell when the premium gets too rich you can even get a better return then that. I've used it for years primarily because it's difficult to impossible to diversify if you own bonds directly in a small portfolio, plus I like the fact that you can get out in the middle of the day at a printed price. I don't recommend anyone get into something like this now, since I expect it to lose principle as interest rates move up. Plus it is leveraged and has a portion in foreign and corporate debt, so the risk is higher then government bonds. I tend to think the return is worth the risk, but then that's me.