30DD Update 2015-07-08 | Investors Alley

30DD Update 2015-07-08

Trade Close: Closing Position in ETRACS 2X BDC ETN

The ETRACS 2X BDC ETN (NYSE:BDCL) will go ex-dividend on Friday, July 10. Today I recommend closing the open 30 Day Dividends position in BDCL to avoid the approximately $1.00 share price drop that will accompany the ex-dividend event on Friday.

The BDCL share price is down about 4% from when I recommended establishing a position on May 7. This high-yield ETN has averaged a 12% share price swing between ex-dividend dates, but over this last quarter it never reached more than 3.75% above the post ex-dividend low. That peak was reached in early June.

The interest rate fears in the financial sector have resulted in a general sell-off in the BDC sector tracked by BDCL. After Friday, the clock will start ticking again for a share price swing.

Recommendation: Sell BDCL to close any open positions before the market closes on Thursday, June 9.

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