m**********r
发帖数: 887 | 1 I thought it is zero coupon bond fund. | m****u
发帖数: 229 | 2 which broker do you use?
I see a Declared QRTR Div 1.04 / Payable Date 12/29/2010 which is a 4.69%
Yield.
Based on what I see, I think EDV holds AAA gov bonds. | m**********r
发帖数: 887 | 3 Vanguard.
EDV is zero coupon treasury bond fund. | m****u
发帖数: 229 | 4 How should you suggest EDV pay you back on the money that it made from zero
coupon treasury bonds? | p*****o
发帖数: 1285 | 5 NAV appreciation, or capital gain distribution if some bonds are sold before
mature. I don't understand why it has dividend distribution either.
zero
【在 m****u 的大作中提到】
: How should you suggest EDV pay you back on the money that it made from zero
: coupon treasury bonds?
| m****u
发帖数: 229 | 6 EDV’s report says it has a “Net Investment Income” and a Net Realized and
Unrealized Gain on Investment”.
There is a dividend from the net investment income and Distributions from
Realized Capital Gains. I think the two above together are the 4.xx%
dividend that an ETF share holder received.
Here is an example that I came up with.
I go buy a strip at $98, when it matures, it will be $100, if I hold it all
the years until it matures, I will have $100-$98=$2 on income which is a
type of interest and is not a capital gain.
I guess people can trade bonds with each other and make some capital gains
so I will skip this example.
And with the two things above, I think dividend from EDV is normal. | p*****o
发帖数: 1285 | 7
and
all
I thought that this $2 counted towards NAV appreciation and needed not to be
distributed, but it seems that I was wrong.
【在 m****u 的大作中提到】
: EDV’s report says it has a “Net Investment Income” and a Net Realized and
: Unrealized Gain on Investment”.
: There is a dividend from the net investment income and Distributions from
: Realized Capital Gains. I think the two above together are the 4.xx%
: dividend that an ETF share holder received.
: Here is an example that I came up with.
: I go buy a strip at $98, when it matures, it will be $100, if I hold it all
: the years until it matures, I will have $100-$98=$2 on income which is a
: type of interest and is not a capital gain.
: I guess people can trade bonds with each other and make some capital gains
| m**********r
发帖数: 887 | 8 So, EDV will hold some of the bonds to mature? | m**********r
发帖数: 887 | 9 I think I get it now. It is STRIP, so there are actually two seperate parts
build in.
A:the principal
B:the compunded interest income from the original setted rate.
Thus when they sell assets before mature, the income will be two parts,
A: the market value of the principal, which can be a gain or loss and this
part is categoried into capital gain/loss
B: the accumulated intrest income which is compounded with the original rate
. And this part is distributed as dividend.
Is that right? | p*****o
发帖数: 1285 | 10 To make no-coupon bonds, the treasure bond (or whatever else) is split in
two: one is the principal, the other is the coupons. These two parts are
then made into two no-coupon bonds and sold separately. The principal bond
can not make any dividend distribution. All incomes must be capital gain
due to the bond price change even if it's sold at mature. The coupon bond
works similarly, but more like a bond fund with a series of mature dates.
Since neither bond carries any coupons, I still cannot see where is the
dividend from.
parts
rate
【在 m**********r 的大作中提到】
: I think I get it now. It is STRIP, so there are actually two seperate parts
: build in.
: A:the principal
: B:the compunded interest income from the original setted rate.
: Thus when they sell assets before mature, the income will be two parts,
: A: the market value of the principal, which can be a gain or loss and this
: part is categoried into capital gain/loss
: B: the accumulated intrest income which is compounded with the original rate
: . And this part is distributed as dividend.
: Is that right?
| m**********r
发帖数: 887 | 11 Well, I guess all the gain from the second part (the accumulated but not
paid interest) is treated purely as dividend when you sell the bond. I think
this make sense, cause this part is caculated by the fixed interest rate of
the bond when it was issued and is not subject to intrest risk and market
fluctuation.
Think it this way:
When you hold coupon bond, you get dividend paid cash twice a year. when you
sell it, you get back the current market value of your principal.
When you hold zero-coupon bond, you get dividend twice a year too but is
hold somehwere and not paid to you as cash. When you sell it, you get back
the market value of your principal AND all the dividend that has been hold
from you.
bond
【在 p*****o 的大作中提到】
: To make no-coupon bonds, the treasure bond (or whatever else) is split in
: two: one is the principal, the other is the coupons. These two parts are
: then made into two no-coupon bonds and sold separately. The principal bond
: can not make any dividend distribution. All incomes must be capital gain
: due to the bond price change even if it's sold at mature. The coupon bond
: works similarly, but more like a bond fund with a series of mature dates.
: Since neither bond carries any coupons, I still cannot see where is the
: dividend from.
:
: parts
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