Dependable Dividends: AllianceBernstein Global High Income (AWF) Posted Mar 17th 2010 11:40AM by Steven Halpern Filed under: Newsletters, Stocks to Buy
For a stellar yield of 8.8%, superb track record and a healthy exposure to sovereign debt, it's hard to beat the AllianceBernstein Global High Income Fund (AWF)," says income expert Amy Calistri.
The editor of The Daily Paycheck -- an advisory that monitors an ongoing $250,000 portfolio of yield-oriented stocks, the advisor explains, "And when it comes to income, AWF is as steady as they get, having spewed out monthly paychecks for nearly 17 years. Since its 1993 inception, this closed-end fund has delivered an average annual return of +12.0%."Calistsri continues, "Approximately 30% of the fund's portfolio holdings are related to sovereign debt, while the balance is held in corporate debt and asset-backed securities. "With 688 total holdings, it might be hard to find a portfolio as diversified as AWF's. Roughly 50% of the holdings are from the United States. However, the holdings hail from 51 different countries over all.
"When it comes to its corporate holdings, AWF seeks to avoid loading up on one sector in particular.
In the most recent filing, the fund managers noted that bonds in industrial companies make up about 30% of the portfolio, with lesser exposure to consumer, telecom, energy, and finance stocks.
"These bonds aren't blue chips, but many are still household names. For instance, it holds debt from the department store Macy's. Debt issued by Time Warner Telecom is another holding.
The building material company Owens Corning and L-3 Communications, a company specializing in military technology, also have debt in AWF's portfolio. But while they may be familiar names, they don't always come with the "best credit ratings.
"AWF tends to favor emerging market sovereign debt, and has bonds issued by governments such as Argentina, Brazil, and Indonesia. Yes, higher risk -- but yes, higher income.
"AWF raised its monthly dividend in December 2009 to $0.10 per share from $0.0925 per share. It's new annual dividend of $1.20 per share represents a yield of 8.8% at current prices ($1.20/$13.59).
"The fund is leveraged, but only by 11.0% -- which is not as high as many of its peers. This serves to increase the fund's income, as it can borrow at lower rates and invest in more loans at higher rates.
"But it can also be a source of risk in a protracted downturn. AWF is trading at a slight discount to its net asset value (NAV), which also gives investors a slight advantage on yield.
"Action to Take --> When it comes to credit quality, AWF is on the riskier side. But after 17 years, these fund managers have clearly demonstrated they know how to manage risk.
"And diversification has obviously served this fund well. The fund can be volatile, although the income stream is as dependable as the sunrise."
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Morningstar Category: World Bond World bond funds invest 40% or more of their assets in foreign bonds. (However, funds that invest more than 65% of their assets in emerging-markets bonds are classified as emerging-markets bond funds rather than world bond funds.) Some world bond funds follow a conservative approach, favoring high-quality bonds from developed markets. Others are more adventurous, and own some lower-quality bonds from developed or emerging markets. As a result, the risk and return potential of these funds varies greatly. Morningstar Rating Rating as of 09/30/11 Overall RatingOut of 12 Funds.**** 3 Year RatingOut of 12 Funds.***** 5 Year RatingOut of 9 Funds.*** Historic Return=Above Average Historic Risk=Above Average
Past performance is no guarantee of future results. The ratings reflect historical risk-adjusted performance, and the overall rating is derived from a weighted average of the fund's 3, 5 and 10 year (Morningstar Rating) metrics.
AWF pays a monthly dividend of $.10 a share, near 10% annual dividend. The fund not only invests in U.S. high dividend stocks, but also globally, allowing the investor to own a percentage of high dividend foreign stocks that otherwise would not be available in the NYSE. Nice, tidy, little monthly income, way above most stock's pay.
AllianceBernstein Global High Income Fund, Inc. (formerly Alliance World Dollar Government Fund II)
AllianceBernstein Global High Income Fund, Inc. (AWF) (formerly Alliance World Dollar Government Fund II) primarily seeks high current income, and secondarily-capital appreciation. The Fund invests, without limit, in securities denominated in non-U.S. currencies as well as those denominated in the U.S. dollar. The Fund may also invest, without limit, in sovereign debt securities issued by emerging and developed nations and in debt securities of U.S. and non-U.S. corporate issuers. The Fund may invest substantially all of its assets in high yield, below investment grade, bonds.
AWF pays a monthly dividend of $.10 a share, near 10% annual dividend. The fund not only invests in U.S. high dividend stocks, but also globally, allowing the investor to own a percentage of high dividend foreign stocks that otherwise would not be available in the NYSE.
Effective September 25, 2009, the Fund acquired the ACM Managed Dollar Income Fund.
Historical Pricing Daily Pricing (as of 10/6/2011 ) NAV ($) Change ($) Market Price ($) YTD NAV Expenses Net of Waivers/ Reimburse ments (%) Expenses Before Waivers/ Reimburse ments (%) As of Date High (date) Low (date) 13.56 0.11 13.40 15.72 (5/3/2011) 13.45 (10/5/2011) 0.97 0.97 3/31/2011
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Net of Waiver Fees reflect the Adviser's contractual waiver of a portion of its advisory fee and/or reimbursement of a portion of the Fund's operating expenses. This waiver extends through the Fund's current fiscal year and may be extended by the Adviser for additional one-year terms. Absent reimbursements or waivers, performance would have been lower.
Month-End | Quarter-End
Description (as of 10/6/2011 ) Annualized (as of 9/30/2011 ) Inc. Date MTD YTD 1 Yr. 3 Yrs. 5 Yrs. 10 Yrs Since Inc. NAV: - - -0.40 16.85 10.17 14.53 12.30 7/28/1993 Market: - - -4.62 21.93 11.36 13.55 11.46 7/28/1993
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