The second consecutive distribution under the recently announced new 'Managed Distribution' policies for the Adams Diversified Equity Fund (ADX) and Adams Natural Resources Fund (PEO) is a cut.

In the new 'Managed Distribution' policy wording, both funds explicitly state that they will pay an average of NAV for each quarter, but did not specify if the average was based on annual NAV spread over four quarters or quarterly NAV averaged over four quarters which would qualify them as rolling quarterly NAV (RQNAV) funds as defined by 'CEF Mastery.' With this recent distribution change, it appears we now have two new (RQNAV) funds. This would be true even if the distribution change was an increase.

The Fund pays distributions four times a year. Distributions under the MDP can be derived from net investment income, realized capital gains, or possibly, returns of capital, and are payable in newly issued shares of common stock, unless a shareholder specifically elects to receive cash. The Fund has committed to distribute 2% of average NAV for each quarterly distribution, with the fourth quarter distribution to be the greater of 2% of average NAV or the amount needed to satisfy minimum distribution requirements of the Internal Revenue Code for regulated investment companies. Average NAV is based on the average of the previous four quarter-end NAVs per share prior to each declaration date.

Fund Announcement

Certain BlackRock Closed-End Funds Announce Tender Offer in Conjunction with Results of the Quarterly Measurement Period of their Discount Management Programs

Read press release:

dmp-pr-to-announcement-1q25-measurement-period.pdf

Latest YouTube Video Post

I posted a promo video to YouTube Sunday evening. Click the link to watch.

Closed End Fund Mastery 360 - Be Your Own Expert Duration: 16:39

Did 'Divi-X' Just Solve All Your Fears About NAV Erosion?

This Applies to Non-Divi-X Users Also

One of the biggest concerns expressed to me by new members is the topic of NAV erosion, or the returns from a fund not outpacing NAV erosion. The revelation came to me a few months ago that I may have been sitting on a solution to this problem the whole time.

Many of you won't remember this because you weren't members at the time, but some of you will. I walked through a real-world example of the returns of (PHK) over the last twenty years with and without 'Divi-X.'

I'm not going to re-hash the power of 'Divi-X' returns over non-'Divi-X' returns only to make my case for using 'Divi-X,' I presented the chart below. Do any of you remember this?

The point of this exercise at the time, was to illustrate that while the fund (PHK) lost over -65% of its value, the fund still managed to post positive gains because of the high yield, even though the fund also cut its distribution by more than -60% over the last twenty years as well.

When the position in (PHK) was initiated on November 1st, 2003, the yield on cost was 10.11%.

After twenty years, post several cuts during that time, yield on cost settled in at only 3.98%.

With the conclusion of the article, non-'Divi-X' returns averaged only 5.6% annually. A clear case of a fund not keeping pace with NAV erosion while also failing to post returns at least equal to the fund's initial 10.11% yield on cost. Ironically enough though, 'Divi-X' did manage to keep pace with an annual average return of 10.1%.

So, What's My Point?

I've been working on a really cool 'Divi-X' dashboard for the 'Divi-X' system. It was supposed to roll out last month, but just as I was about to release it, a flood of ideas to improve it came to me all at once. A few of those ideas included improvements to "The 'Divi-X' Workbook." The most notable being that I converted it to allow for people not interested in using the 'Divi-X' system to use the workbook for non-'Divi-X' investments.

Big Deal, My Broker Already Keeps Track of My Investment Returns

Do they really? Can you say with absolute certainty that your high yield investments are outpacing NAV erosion based on information offered by your broker? Does your broker accurately reflect your return on investment plus dividend returns? What about by asset class?

The upgraded 'Divi-X' workbook and dashboard will now offer all sorts of tremendous portfolio insight for all investment types; high yield, no yield, public and private. That's right! If you can assign a unit cost to it, you can track it in 'Divi-X.' Whether you are a 'Divi-X' system user or not.

Position Return Summary/Detail Chart

Here is just one of the many features in the "The 'Divi-X' Dashboard." I removed the title and added text for clarity. The 'Position %' chart breaks down all critical aspects of a stock/fund. For 'Divi-X' users, it reveals the original leverage position vs current leverage position (this will be blank for non-'Divi-X' users), your projected returns (goals set by you in the 'Divi-X' workbooks), versus without 'Divi-X' (purple) versus 'Divi-X' (green). Current Yield on Cost w/o versus 'Divi-X', and the annual average rate of return w/o versus 'Divi-X' (purple and green will be equal for non-'Divi-X' users). All returns include distributions cumulatively and annually!

Using the filter options on the left, you can select security by ticker, purchase date, or all. If you are looking at a ticker, clicking the '+ -' buttons will expand to reveal individual returns by purchase date, or you can collapse again just to reveal summary returns for the entire position.

You can compare detailed purchases and summaries side by side of the same ticker, or different tickers.

You can view up to five positions in one chart clearly.

The best part is that, aside from an occasional dividend change, once you set up a position, it's almost entirely automated. You won't have to update individual workbooks, and you don't even have a login page.

Bottom Line

You'll no longer have to guess, calculate, and hope your investments are performing well especially, when NAV erosion might be involved. All returns are calculated in real time.

More details coming soon.

I hope to have the final version available in a couple of weeks.

Nearly half of all 'CEF Mastery' distribution cuts throughout its history come from only seven (RQNAV) funds. If you would like to learn more about (RQNAV) funds, I pasted a link below.

Understanding (RQNAV) funds

The 'Divi-X' System High Yield Portfolio Performance

'Divi-X' and 'CEF Mastery' are two distinct and separate programs offered by 'The Dividend Times.' Both programs complement each other considerably well.

This portfolio was created solely for the purpose of this weekly update. It is real money. It is intended for informational purposes only.

Inception date: 07/19/23

Portfolio performance as of Today @ 11:45 a.m. Distributions are 'Not' reinvested.

The 'Divi-X' high yield portfolio is an aggressive use of the 'Divi-X' system. There are more conservative uses of the 'Divi-X' system that can have a very satisfying result on your returns as demonstrated in the following video.

The 'Divi-X' System - Dividends on Steroids

The 'Divi-X' system utilizes leverage and can be considered very risky. Use at your own risk! The 'Dividend Times' makes no claim that using the 'Divi-X' system will outperform the market.

See attached portfolio performance download at the bottom of this report. Click on 'View content' to be taken to the download page where you can also download the 'BDC Scorecard' as well.

Feel free to send me questions or comments.

Have a fantastic weekend.

Lee

TheDividendTimes@outlook.com

803-659-1232

None of the information contained in this newsletter should be construed as financial advice.

If you are a new subscriber, expect the 'CEF Mastery' Weekly Report to come out every Saturday.

Just a reminder that 'ETF Mastery' is free to 'CEF Mastery' subscribers while in its development stage.

If you aren't a subscriber, a free 'CEF Mastery Super Screener and Interactive Report' is available by entering 'Free Report' in the subject line of your email to the address TheDividendTimes@outlook.com.

or

You can receive one free month of reports (weekly) with an annual subscription of just $49.95/yr.

Subscribe @ 'CEF Mastery' Closed-End Fund Subscription (gumroad.com )

'Closed End Fund Mastery' is best viewed in Microsoft Excel (Excel 365 to use charts).

See 'Closed End Fund Mastery' in action. Video links below.

‘CEF Mastery’ Introduction – Be A High Yield Master: https://youtu.be/xR9ZmD0LxRM

‘CEF Mastery’ Quick Start 1 – Super Screener - https://youtu.be/-cABQvyVMwI

‘CEF Mastery’ Quick Start 2 – Fund Comparison - https://youtu.be/1GCrtriBQVY

"What Makes the 'Closed End Fund Mastery' Super Screener So Super?' - https://youtu.be/H1AM958Ie_w

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