Category: MAPF

The monthly return for Malachite Aggressive Preferred Fund has now been calculated. The unit price is $9.6162 after a third-quarter distribution of $0.050227.

Returns may therefore be calculated as:

Note that past performance should not be taken as a guarantee of future performance. You can lose money investing in MAPF or any other investment. 

The nice thing about these returns is that they have been virtually entirely dividends and capital gains, resulting in a generally lower tax rate than for interest for most taxable investors.

I have been remiss! I haven’t yet bragged about the results of Malachite Aggressive Preferred Fund in August.

The fund returned 1.79% in August, after expenses but before fees. In comparison, the BMO-NB 50 returned 0.86% (I use a third party benchmark rather than my own indices, both because my indices are currently still experimental and because I think casual readers may consider external benchmarks more appropriate for my own product).

This makes the 12-month comparison (MAPF after expenses but before fees) to MAPF: +5.92%; Index: +3.64%. There’s lots more information available at the main site. Past performance is not indicative of future results and you can lose money investing in MAPF or any other investment.

Contributers to the success of the fund in August were:

• BAM.PR.J (a long term holding that is still undervalued, according to me) returned 1.955%
• RY.PR.B, bought near its July lows, returned 1.6633%
• PWF.PR.L, bought partially at the issue price (bargain!) and partially on the first day of trading (bargain! just not so good) ended the month up about 2% from the all-in purchase cost

At July 31, 2006, MAPF had a unit value of $9.3608, a return of 0.24% (after expenses, before fees) on the month, vs the BMO-NB50 return of 0.35%

The last three months have been flat against the index – there are, I think, two major sources of this reduction in excess returns:

• Reduced volatility : the market’s not doing anything! It’s volatility that allows for trading with significant profit.
• BAM.PR.J The fund has a large holding in BAM.PR.J, which returned -0.51% on the month and is -2.52% YTD (total return). I just don’t understand it – for some insight into just why I don’t understand it, see Operating-Retractible Yield Curve, 2006-07-26. Surely at some point the issue will come more in line with its peers … but I’ve been saying that for a while now …