The NFJ Dividend & Premium Strategy Fund (NFJ) is managed by Allianz Global Investors. According to their website, the 1,000 largest stocks are screened for low price/earnings (P/E) ratios, high dividend yields and visible earnings. NFJ applies a quantitative grid that measures price momentum, earnings revisions, fundamental change, and insider trading. In-depth fundamental research is done on the remaining 250-300 companies, focusing on earnings, cash flow generation, and product potential. From this list, the fund managers construct a portfolio of 40-50 companies. They regularly monitor buy and sell candidates. They sell a stock when an alternative stock with equally strong fundamentals demonstrates a substantially lower price/earnings ratio and/or a substantially higher dividend yield.
NFJ utilizes both broad index options and narrower based sector index options with the objective of optimizing the correlation between the NFJ stock portfolio's sector allocation and the option strategy's exposure. Their holdings may include convertible securities. NFJ does not use leverage.
The fund's top holdings as of 12/31/2012 were: Pfizer (3.54%), GlaxoSmithKline (3.08%), Total SA (3.05%), ConocoPhillips (2.96%), and AstraZeneca PLC (2.89%).
NFJ's market price at the close on January 22 was $16.43. As of January 18, the market price was $16.53 and the net asset value (NAV) was $17.72, for a discount of 6.71%. The quarterly distribution is $.45 per share, for a 10.955% yield at the $16.43 January 22 market price.
As of 12/31/2012, assets were $1.631 billion. The fund assets included 73.77% common stocks and 26.59% convertible securities.
This closed-end fund (CEF) was added to the portfolio in January, 2013. It comprises 5.0% of the portfolio.
Morningstar reports that the annual expense ratio for NFJ is .97%.
This is not a recommendation to buy NFJ. Each person's situation is different. Do your own research.
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