The month of Nov 2017 is another month of dividend income landing in my own accounts. This money can be used to help pay my expenses if it’s needed. If the money isn’t needed, it is ALL used to buy new investments to further increase my cash flow. 263.the months of November 2017 24 in dividend income for. This represents a 15.07% lower from 3 months back and 9.14% lower year over 12 months. 3707.65 in dividend income for 2017 as of this writing.

I will upgrade my dividend income tab with the new amount I will include my option high quality income also. It is great to see money from passive income sources transferred into my brokerage account each and every month. How was your dividend income for November 2017? Disclosure: Long all securities above. I am not just a financial planner, financial consultant, accountant, or tax attorney. The information with this blog represents my own viewpoint and really should NOT be taken as investment or business advice.

Who are they selling to? Enter the merger arbitrageurs, including MERFX and ARBFX. 6.4%. Since this only requires a third of the entire year, annualized comes back are in the double digits. Of course there is a significant offer risk, which is exactly the reason the long-term holders of company B shares are selling at a discount. Merger arbitrageurs mitigate this in a number of ways, most of all by buying a large number of deals so that anybody deal falling apart will not make a lot of a direct effect on the portfolio as a whole.

Arbitrageurs also mitigate offer risk through very good homework and sometimes by options strategies (perhaps by buying put options on company B’s shares in our example). MERFX and ARBFX do exactly what is defined above with the added problem that lots of of the deals are a little more technical in structure than a simple all cash deal.

50 per share of company B by means of its stock. In that full case, the arbitrageur buys company B and pants enough company stocks so that whenever the offer closes the arbitrageur will simply pocket the merger spread. This is an important point, as well will discuss in an instant.

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Both funds regularly have 50 to over 100 offers in the finance at any moment, which greatly reduces the chance of an individual blown deal trashing the account. A key appeal of this money is they have a very low correlation to other asset classes and very low volatility. Returns of these funds vary, and some full years are better than others. During the last 10 years, MERFX gained about 3.5% yearly and ARBFX gained 4.7% each year, both in the same neighborhood of the S&P500 at about 4% yearly.

However, the arbitrage money did so at lower risk and with a much smoother ride vastly. Deal performance tends to follow the number and size of deals. In years whenever there are lots of deals being done, returns tend to be better. All of this seems great, but there are catches as always. First, these funds are exposed to deal risk primarily.

If lots of deals fail, these funds shall get hurt. An added issue worth noting is these funds are both relatively expensive, with expense ratios north of 1% annually. With index funds available at less than .10% annually, that is a great deal of cabbage. Given the specialty nature of these monies, the diversification they offer, and the necessity for talented managers at the helm, I can justify the expense to myself. As always, be careful, consult your advisor, do your homework, and take your own risks. This isn’t designed to be investment advice. YOU can lose money as of this stuff.