The issue I see with these funds is if you don't use the income, but instead reinvest the dividends to keep up with the NAV of the underlying index, then you are being taxed on those dividends vs the strategy of keeping your $ in SPY or QQQ, in which you hardly have any taxes (they have small dividends...2%)....so monthly dividend payouts will drag your personal total return even lower. (Except if the dividends are ROC, which aren't taxed.) @thbfinance- what's your take on this?
She definitely dodged the question whether if she can keep up the yield lol… the way I see it is expect to lose ALL of your initial capital in return for monthly income. As long as you don't sell, eventually you will recoup your money back
Thanks for the interview. To me it's such a cop out when they say "we believe you should reinvest the dividends". I feel like they're trying to cover for the crappy performance. I get it, but some of us want to live off the dividends and don't want to reinvest. What's the point? If that's the case, I'd rather just invest in a non dividend fund and not have to pay taxes. I did invest in QTUM awhile ago and that one has been amazing!
She seems to be shifting blame for NAV decay to investors not reinvesting dividends. But this was - and still is - advertised as a high “income” fund. So investors should be expected to want to receive outsized dividends and not necessarily reinvest them. This seems like an unsustainable fund that’s linearly declining and will need to sooner or later cut dividends and do reverse splits.
Also if this fund goes from $17.30 ish at the end of Feb to almost $16.20 ish in less than 30 days, re-investing all the divs won't help that much of a loss over such a short time. And now when April comes round it may drop down to almost $15.80 ish because of the distribution. But then you look at QQQ and it's up, how is this supposed to help if the losses are greater than the dividend every month.
@@alexisnoakes4899 I don't like the at the money put sells. That caps any recovery too much. Now Jay said in the November interview that its the same as a covered call but with a different structure, but it's clear it has a different effect than a synthetic + OTM covered call. With the puts we make a premium and nothing more when the underlying goes up. With the synthetic we lose money on the covered call if it goes past the strike, but we keep making money on the synthetic when the underlying goes up. That is a difference.
If they are saying “you need to re-invest the dividend” then it’s not an income fund at all. If everything you get needs to go back in…..how is that income. Something not getting addressed
I think the principle behind the “need to reinvest” to maintain your portfolio $$ is that the dividend is higher vs the total net return of the fund. Presently QQQY is up about 20-25% on a annual total return basis, but the dividend is about say 60%. So we have to understand to re invest 2/3 of the dividend and one can spend the rest of it and portfolio amount is maintained. But higher yield can be obtained by reinvesting all the dividend and the combined effect of the lower NAV with time and compounding the reinvesting of the dividend. I’m really surprised either Defiance ,JAY or others RU-vidrs didn’t explained the concept fully
The issue with this is, again, don't call them income. And if the point is to reinvest 2/3 of the dividend, there are other WAY more stable and have growth that will pay 20%. No need to stress if they miss calls for the month. 60% of $20 pps is different than 60% of $17pps.
Hey Coach! I’m pretty new to your channel, may I ask what is the “bing” sound coming off from time to time ? I find it very agressive and must be annoying for your guest. Any way to turn this off ??
Coach putting in work at the gym before having Sylvia on, see if she will give you a date! Good interview! Thanks! Spyt sounds more fun then loosing all the NAV!
