Q: You had some previous thoughts on this one. I'm attracted to the 9-10% dividend but concerned about your previous comments that this one could be "hurt" by lowering interest rates. I guess that is why it is near a 52 week low. Any thoughts on this one now and as we head into 2025 ... is the ~ 9% dividend safe...it's been at ~ $ 17 for almost 2 years ... is the share price safe at around that level ?
5i Research Answer:
With rates coming down in the future, we would be cautionary to say that a yield this high will be sustained, especially given MFT's floating rate focus. As rates come down, interest payments will come down as well which should lower the yield overtime. However, if the price of the fund declines by a greater proportion, yield may look attractive. The share price will likely trade close to NAV which will depend on market conditions.