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Stock Talk - Cara Esser, Morningstar

Jan 7, 2013|

Stock Talk - Cara Esser, Morningstar

Transcript - will not be 100% accurate

-- not a filling in for Barry Armstrong on the financial exchange and we are joined now. -- -- answer from Morningstar and -- how are you this morning. I'm good -- thanks for having me this morning. It's great to have you here and I don't he had sent over a couple picks for us and one thing to note just for all of our listeners is these are closed end funds I don't know a lot of our listeners are familiar. With what they closed end fund is cares so what do you give them a little background on -- to begin with. Chuck Cook and fun is like a mutual fund that is. Trade on an exchange like a stock at a price per minute that I attended an actively managed portfolio that you can buy and felt like you could tell by -- -- stock. Okay and the first funded that you have here is to Aberdeen Asia Pacific income fund in this as the ticker. -- act so won't you tell us a little bit about what this fund goes about investing in. That's funny is -- unique record budget -- both Australian Asian fixed income. And that the section of our and one of our highest Morningstar analyst -- of -- -- really like -- -- at a distribution rate of 5% of the solid and strong distribution rate made made a market income. And it was up 12% in 2012 or to the pretty strong number and it's currently selling at 1% premium which is on par -- historical standard -- it's it's relatively standing valued at that point. And this is something that you could see -- supplementing may be the core of your fixed income portfolio correct yeah. Yeah OK so you know in terms of where where you might find this in my be alongside of a more traditional bond fund may be a corporate bond fund just as a portion of -- portfolio. Yet we call it more like a satellite holding at the poster that to a core holding. OK and again that is the Aberdeen Asia Pacific income fund with a ticker. FAA acts if you do want to learn a little bit more about that the the second -- that we have here is the dean Anderson MLP fund in this as the ticker. K why and why don't you tell us a little bit about this -- So that's -- and -- -- energy and related securities it master limited partnership that we had a lot of interest -- master limited partnerships after the closed end funds based investors looking to get into this. This area it's hard to -- on your own. Without the fund kind of wrap around that -- this is one of our favorites it's been a strong performer the last year than last year -- up 13%. Telling an 8% premium which sounds like a high premium that it actually narrower than historical standards we would say that it's it's relatively undervalued at this point in the distribution rate is ninety. And master limited partnerships just for a lot of listeners that might not be familiar with them they're typically an energy space as oil and gas pipelines correct. OK so. If if you're looking to put this into a portfolio what type of holding do you see this as is is this again kind of a satellite holding the core of -- equity portfolio. Yet that it might have satellite or even initial holding smaller holding he wouldn't want your entire personally to be here but it supplement especially that income portion of the portfolio with a 9% to -- -- that can really supplement an equity based portfolio. Okay and then the -- the last one that we have here is that how almost convertible opportunities and income fund. Tell our listeners a little bit about how this operates and what they're going out and -- So that's fun and that's mostly in convertible securities or their using derivatives to create convertible like security and it managed by Calvert asset management health. They actually are really eat the long history and at investing in convertible securities it's mostly what they view on the clothes inside that they're very good at this -- -- convertible securities. That is the good for him to go within this is one of our favorite sites from that farm. On it was up fourteen and a half percent last year but it's appreciated also 9% and it selling it 3% discount which is pretty good. All right and again convertibles probably not something that most investors are familiar with is this again kind of that niche or. Satellite holding. Already will -- I appreciate you coming all this this morning and certainly we will take a look at those positions. Again appreciate all the info. All right that was terror essar from Morningstar if you work interest it again the takers for those three closed end funds. FAA expert Aberdeen Asia Pacific income fund. KY and for the -- Anderson an LP fund. And CH I for the -- most convertible opportunities and income fund. Coming up we are gonna be getting back to -- text question that they text us at 68680. Do you expect to get money back on your tax return or hit it with a big bill. Let us know what your expectations are also. Still giving away 25 dollar gas card when you hear the gas pump bell -- 25 caller 882052263. With today's password standing rib roast we're coming back right after this break on the financial exchange.