Weiss Korea Opportunity Fund Ltd. (WISKF)

[56Chevy]

Corruption by Country / Territory

South Korea ranks 43rd out of the 175 countries under review.

*being ranked #43 puts them on the "good guy" end of the scale...for example their neighbor to the north (North Korea) is ranked #174 out of 175 nations.

http://www.transparency.org/country#KOR

[56Chevy]

How do you solve a problem like Korea preferred shares?

Weiss Korea Opportunity has a niche investment focus and has delivered strong returns.

Sep 18, 2014

In May 2013, Weiss Asset Management, which is probably best known for hastening the demise of unloved investment companies as an activist investor, decided to launch one of its own. A bold move in some ways as it would have to ensure that it never attracted criticism on corporate governance grounds – so it went out of its way to protect shareholders’ interests.

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http://citywire.co.uk/money/how-do-you-solve-a-problem-like-korea-preferred-shares/a773195

[56Chevy]

Introduction

The Company invests primarily in South Korean preferred shares. In South Korea, the term "preferred share" is a misnomer and Korean preferred shares are misunderstood by many Western investors. Korean preferred shares are more comparable to non-voting common shares than the preferred shares in most other countries. In general, Korean preferred shares do not have a fixed dividend or a maturity date. Instead, the typical contractual terms of preferred shares state that their dividends will be incrementally higher than the dividends of their corresponding common shares. Hence, those preferred shares fully participate in dividend growth of the issuer. In spite of this, many Korean preferred shares trade at significant discounts to their corresponding common shares. For example, one of Hyundai Motor Company's preferred shares closed the year at a price of W113,500; by comparison Hyundai's common shares closed the year at a price of W236,500 - in spite of the fact that the preferred share receives a slightly higher per share dividend. As a result of this anomaly, typically preferred shares' price-to-earnings ratios are substantially lower and their dividend yields are higher than their corresponding common shares.

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The Company's two largest company exposures are to: (1) the three Hyundai preferred shares, totalling 27.0% of NAV; and (2) the Samsung Electronics preferred, at 13.3% of NAV as of year-end 2013.

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http://www.investegate.co.uk/weiss-korea-opp/rns/annual-report/201404240700063713F/

Marker:
Weiss Korea Opportun (WISKF)
$2.00 down -0.12 (-5.66%)
Volume: 1,900