blackcat
2 meses hace
Cornerstone Strategic Value Fund, Inc. (NYSE American: CLM) (CUSIP: 21924B302) and Cornerstone Total Return Fund, Inc. (NYSE American: CRF) (CUSIP: 21924U300), (individually the “Fund” or, collectively, the “Funds”), each a closed-end management investment company, announced that in keeping with each Fund’s previously adopted monthly distribution policy, each Fund is declaring the following distributions, which have been reset for the calendar year 2025
Record Date Payable Date Per Share
CLM January 15, 2025 January 31, 2025 $0.1224
CLM February 14, 2025 February 28, 2025 $0.1224
CLM March 14, 2025 March 31, 2025 $0.1224
CRF January 15, 2025 January 31, 2025 $0.1168
CRF February 14, 2025 February 28, 2025 $0.1168
CRF March 14, 2025 March 31, 2025 $0.1168
Michael301981virgo
1 año hace
Easiest trade on the planet premium maxed at 25% to 26% this year but look at how that nav is coming back. CLM was pounded in 2022 and now it looks like they're trying to recover the nav organically with a smaller premium.
Market price up,premium still below 10%.
While I dislike the fact that I belive market manipulation combined with market conditions led to the recent flush to the 6 range, it was a buying opportunity of a lifetime
The nav is in the same range as throughout the last quarter of 2022 and throughout 2023.
Interesting to note the smaller.CRF has a higher premium. For all we know know,we may be entering an era of smaller premiums,but with less coming out of the same nav, better nav performance with less c each month next year makes CLM sound bullish to me
From a nav of 6.09 to 6.65 in a month(6.77 without 0.1228 removed)-thats an 11% increase in nav after you've calculated the distribution with a premium under 10%.
Someone knew the price was going down-why else would one of the principals of the the firm sell near the top right before the premium evaporated? Sit &Associates reduced their stake by over 40% in CLM and CRF is you review the beneficial ownership reports on 2/7/23 vs 10/26/23
Quite frankly,I don't care if there is manipulation-as long I can still make money from it-when the premium to nav gets to 25%-26%,time to take some off the table even if it means missing thr top,in my opinion.
Without a rights offering this year,CLM is actually covering its distribution. When the nav was eroding and the premium expanding to 50 to 80%+,everyone was buying. Now the nav performance from 2022 to 2023 has improved and you have less people buying.
Michael301981virgo
1 año hace
Anyone who purchased CLM at 7/share in Dec 2022 and sold at 8.84/share made a 26% capital gain with a perfect 21% yield on cost or a total return of 34%
That was an outperformance of SPY in 2023.
It doesn't matter if the price is higher or lower every year, it's about paying attention to the premium to nav.
When the premium to nav is 10% or less,CLM/CRF are buying opportunities
When the premium to nav is 30%+,its time to to exit most or all of one's position. This may mean giving up the top at a 35 to 60% premium,but that's all of the speculation needed in the easiest,brainless trade in cef land.
Cornerstone takes speculation out of the market.The guesswork is determining how high the premium will expand after it hits 30%.
Obviously, this statement only applies to those who understand how CLM behaves.
Recently,anyone who sold at a 30% premium to nav at 8.84/share and bought back near the nav at 6.25/share increased his or her share count by 41% and locked in a 20.8% yield on cost after the distribution cut for 2024.
My average price is 6.77,which is not the bottom,but close enough,locking in a 19% yield on cost for 2024. If CLM just hits a top of 7.80/share in 2024,that's a 15% capital gain excluding distributions. A top at $7.80 would be 11.8% less than the top in 2023,in line with the 11.6 % distribution cut,just like the 2023 $8.84 top was 37% less than the $14 top in 2022,in line with the 2022 40% distribution cut.
I don't want you to misunderstand me, I can make 20% -25%in about a week trading TQQQ,
I would only only put my entire portfolio in UPRO/SPXL and TQQQ under the most oversold conditions. However,it should be noted that a 51% cash 25% SPXL 7% TQQQ 17%(insert investment of choice) has the same effect as being fully invested in SPY, with a beta close to 1 with the S&P.
CLM is only a lousy investment for an investor that thinks he or she can buy and hold it forever. There is a formula. Buy when premium is 10% or less,sell when premium is 30%+,reinvest every distribution at the nav(or market price,whichever is lower). Rinse and repeat
Also,paying attention to insider and institutional transactions is helpful in determining when to enter and exit.
Whether there is a distribution cut or increase,you can lock in a nearly 19 to 21% yield if you trade it.
High yielders must be traded. They are not buy and holds. Also,this is a managed distribution,not a dividend. I'm not sure why people call it that when it's right in the prospectus that it should not be confused with yield,fund performance,or income.
It requires very low margin maintenance and as previously mentioned,less speculation than most investments.
I have a feeling market manipulation will get CLM down to a perfect 21%forward yield in December 2023. At that time,I'm ready to buy in further bulk. I margin CLM in one account and typically get excellent results as the distributions reduce the leverage on a monthly basis.
Aside from margin interest,unless distributions include capital gains,the large ROC distributions are tax friendly.
One could easily say SPY was a terrible investment if he or she bought at the 2021 top. I hate to admit this,but yes-pricing and timing matter .
I trade mainly leveraged etns and 3x leveraged index funds. It's nice to have a simple 15 to 25% capital gain dummy trade that requires little brainwork to generate cash flow. Once you recognize CLM for what it is; once you understand it's an asset that requires trading acumen, it can easily outperform SPY,like it did for anyone who bought at 7/share in 2022 or anyone who purchased for under 7/share during the 2022 rights offering or recently when market manipulation evaporated the premium significantly. I don't think it was a mere coincidence that one of the principals of the firm sold 40k shares at 8.72 or the premium reduced significantly when Sit&Associates reduced their stake by over 40%.
I don't do rights offerings but I've certainly learned how to "game" CLM. Having said that, I would say it is not a stock for a retired elderly person unless he or she understands technical analysis and understands the Cornerstone formula and pays attention to the expansion and contraction of the premium to nav. CLM can make or break you At one point my average price was the low of 6.25, but I purchased additional shares at a 10% premium because I know a 10% premium is still a buying opportunity in CLM. With a 15% allocation in an account that is levered up,using about 27% of total equity for a number of trades,that represents a very small overall percentage of my portfolio,which consists of 2 accounts.
Having said that, for the individual with trading acumen,you can have your cake and eat it,too with CLM. Everyone knows CLM overdistributes.
There are much worse investment products out there now generating 50 to 77% yields in which ignorant people are putting their social security in these so-called investments and paying taxes on distributions(options premiums) as their principal continues to erode 40%+
Despite the fact that I've warned a number of people about Yieldmax and KLIP and nav erosion-and the difficulty of turning a synthetic covered call strategy into a share price, the "dividend/income strategy" has become a cult-like following. If I wanted to withdraw from my principal and see it erode over time,I certainly wouldn't want to pay taxes on the withdrawals
Overall, I am a swing trader-when a stock has topped out, it's time to cut loose-dividend or no dividend/distribution.
There is now a generation of people who now think that a 20% yield is too small if he/she wants to retire. I recently chatted with an individual who said they couldn't retire with a 20% yield. I told the individual he may want to reconsider his retirement plan. The general rule of thumb, if it's too good to be true, it usually implodes or is too good to be true.
CLM and CRF are quite docile compared to these riskier "synthetic covered call etfs" in which the fund manager has no intention of taking assignment of the stock on an atm short put position but rather uses a strategy of constantly taking losses until TSLA(insert growth stock here) turns bullish. When I criticized the Yieldmax strategy on a forum, I was told Yieldmax was for a "different" type of investor. Apparently,people don't mind being down 40%+ as long as they get their "dividend" (even though it's an options premium)
Stocks are not bonds yet I find people tell me they didn't buy this or that for capital appreciation but for the "dividend"
Personally, I dislike tumbling 40k in 3 weeks over a much smaller monthly distribution,but to each their own.
Having said that CLM/CRF are not for everyone. I use them as tools to reduce leverage as part of a greater,much more complex strategy. Simply put, as distributions pay down my margin balance, I get to retain more margined stock.
Michael301981virgo
2 años hace
While I am not in a position to give financial advice, I would say one does not buy these funds to spend the distributions as dividends. You buy them to participate in the discounted share dividend reinvestment program. In contrast to most cefs, CLM and CRF only work out to the investor's favor by taking advantage of the discrepancy between the premium and the nav. The longer you reinvest the distributions at the net asset value, the lower your breakeven gets. However, because of one painful all in "risk on" trade I did in September, my portfolio dropped 30% by Oct 20.
Due to lack of significant movement,I reduced my position significantly in CLM and CRF and reallocated 95% of my remaining capital to obliterated leveraged sovereign and corporate emerging market closed end bond funds like EDF,EDI,TEI,FCO,CHW,MSD, mreits, floating rate bdcs, generating 15% up to 59% returns(excluding distributions/dividends) on various positions, plus focusing on floating rate CLO debt and equity, (ECC,OXLC,XFLT,)developed world bond funds, leveraged MLP etns, leveraged etns by Etracs-UBS-that track the Solactive index like SMHB, HDLB, commodity related etns that track the performance of writing covered calls on the USO index like USOI, covered calls on silver and gold futures like SLVO and GLDI by Credit Suisse. 400 pages of trading history later, I was able to recuperate 20% of a 30% loss by January 20, excluding withdrawals. From down 30% Oct 20 to down 10% Jan 20. What would typically take 5 years or more to recover,I was able to do within 3 months. The emerging and developed market bond.funds,mreits, CLO
-related assets have topped out in my opinion, after giving back 2% of reculerated losses thus far in mid February There are, in my opinion, buying opportunities in gold and silver, so Ive cost averaged down on those positions and reallocated 13% of portfolio to CLM as a potential very short term trade,depending on whether or not an N-2 is filed with the SEC within the next 2 weeks.
While I have given back 2% of recuperated losses this February, now down 12% as of today, this excludes withdrawals. When factoring in total return, cash withdrawals from dividends/distributions, I am actually only down 9.4%. Who cares if CLM is gimmicky if you know how to game these funds? It makes a huge difference when you kow what you are investing in.
It took a 25% capital gain on the Oct 20 balance to recuperate 20% of losses within 3 months.
I am not some dumb naive investor that confuses CLM payout with income. I sit on my butt trading the stock market for a living. The fact that it took under 4 months to recuperate most of my losses should give you a good idea that you're not dealing with some naive idiot,falling for a gimmick. I managed to recuperate roughly 2/3rds of losses before a bull market is even remotely likely in the near future. I know what CLM and CRF are and how to trade them. They offer a managed payout policy that should not be confused with portfolio performance, yield or income. The Cornerstone funds are pure premium plays and of Brad Matthews, one of the principals of Cornerstone Advisors considers 8.15/share a buying opportunity,so do I. Let's not forget Sit & Associates just purchased 18 million shares in December. I don't need to buy an index fund. I have no problem doing my research and most importantly monitoring trading ranges. I also maintain a portfolio yield of 14-20%. When it drops under 14%,I rebalance.
My ultimate goal is to recuperate the remaining losses in my portfolio within the next 3 months,including any cash withdrawals. This way returns are magnified when the bull market emerges again
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