Yes. It looks like their plan is to sell just before and rebuy 30-45 days after ex-dividend. I presume they'll use heartbeat trades to try to eliminate all the capital gains from the ETF.Seems like a way to generate a lot of short term capital gains. What are they going to do, sell and then rebuy every dividend paying stock 4 times a year?Those filings appear to be a signal that AA is confident their strategy will withstand legal/regulatory/legislative scrutiny. Or maybe they're just poking the bear!
Really pretty wild that they are going to create an entire suite of income avoiding funds with the goal of surely widening the addressable market space for the box spreads.
The anti-dividend thing is interesting in and of itself. Seems like there could be some significant transaction friction there.
The Fund will seek to achieve broad diversification to U.S. equity markets while avoiding dividend payments from its portfolio holdings. The Fund seeks to take advantage of proprietary research that suggests that stocks scheduled to pay a dividend should be avoided just prior to the dividend distribution and for at least 30 days after the dividend distribution. The proprietary research further indicates that the demand for dividend-paying stocks prior to the dividend distribution is too high (thus driving stock prices above a company’s fundamentals) and the demand for dividend paying stocks after distribution is too low (thus driving stock prices below a company’s fundamentals). The Fund seeks to take advantage of this mismatch in supply and demand in the marketplace. There is no guarantee that the Sub-Adviser will be successful in its attempt to minimize the Fund’s taxable income.
Statistics: Posted by Lyrrad — Tue Sep 10, 2024 10:55 pm — Replies 420 — Views 73717