Value Investment Fund – Status on May 31, 2023
. May 31, 2023 April 30, 2023 May 31, 2023
. # of Shares Cost Basis Net Market Price* Net Fair Market Value* Net Fair Market Value*
REITs
. – Essex Property Trust, Inc. (Tranche #1) 71.6846 $20,000.00 $215.06 $15,680.29 $15,416.49
. – Essex Property Trust, Inc. (Tranche #2) 77.7000 20,000.00 215.06 16,996.10 16,710.16
. – Essex Property Trust, Inc. (Tranche #3) 100.0000 22,221.00 215.06 21,874.00 21,506.00
. – Essex Property Trust, Inc. (Tranche #4) 180.0000 44,980.00 215.06 39,373.20 38,710.80
. Sub-Total 429.3846 107,201.00 $93,923.59 $92,343.45
. – AvalonBay Communities 100.0000 16,917.94 172.98 $17,937.00 $17,298.00
Railroads
. – Norfolk Southern Railroad 100.0000 20,808.00 207.18 $20,203.00 $20,718.00
Entertainment
. – The Walt Disney Company (Tranche #1) 180.1801 20,000.00 $86.96 $18,288.28 $15,668.46
. – The Walt Disney Company (Tranche #2) 200.0000 21,200.00 86.96 20,300.00 17,392.00
. – The Walt Disney Company (Tranche #3) 198.0198 20,000.00 86.96 20,099.01 17,219.80
. Sub-Total 578.1999 61,200.00 $58,687.29 $50,280.26
Banking
. – Wells Fargo (Tranche #1) 100.0000 4,267.50 38.81 $3,875.00 $3,881.00
. – Wells Fargo (Tranche #2) 400.0000 15,804.00 38.81 15,500.00 15,524.00
. Sub-Total 500.0000 20,071.50 $19,375.00 $19,405.00
Dividend Receivables -0- -0-
Cash on Hand (Basis, Gains, Dividends, PUTS) 1,543.30 1,458.44
Totals (Starting Cost Basis = $100,000) $226,198.44 $211,669.18 $201,503.16
Accrual adjustment for taxes 4,396.76 7,323.04
Totals Net of Taxes (Recapture) $216,065.94 $208,826.20
Margin Account (AvalonBay/Norfolk Southern Purchase) (36,986.22) (36,986.22)
This portfolio’s value is AFTER TAXES of 28% on all realized gains. Total taxes paid to date 35,150.98 35,150.98
Comparative Gross Return Since Inception $214,230.70 $206,990.96
Unrealized Earnings (Value of Respective Market Prices Less Cost Basis/Fees at Point of Sale) $(15,702.70) $(26,153.72)
*Net of transaction fees of $1.00 per share; thus the amount in the schedule equals the actual market price per share at closing less $1.00 per share.
Value Investment Fund – Potential Obligations
The Value Investment Fund’s current exposure related to PUT options is as follows:
- JP Morgan Chase – sold in May 2022 with a strike price of $80/share and an expiration date of June 16, 2023 $20,000
- Norfolk Southern Corporation – sold in September (200 Shares) with a strike price of $145 and an expiration date of January 21, 2024 $29,000
- Essex Property Trust – sold 12/30/22 (100 Shares) with a strike price of $170 and an expiration date of July 21, 2023 $17,100
- Union Pacific – sold 12/30/22 (200 Shares) with a strike price of $145 and an expiration date of August 18, 2023 $29,200
- L3 Harris Technologies – sold 12/30/22 (100 Shares) with a strike price of $150 and an expiration date of October 20, 2023 $15,100
- Marriott Hotels – sold 12/30/22 (100 Shares) with a strike price of $90 and an expiration date of January 19, 2024 $9,100
- Essex Property Trust – sold 03/17/23 (100 Shares) with a strike price of $200 and an expiration date of October 23, 2023 $20,100
- Huntington Ingalls – sold 03/17/23 (200 Shares) with a strike price of $185 and an expiration date of September 15, 2023 $37,200
*Total financial commitment = $176,800
Market prices on May 31, 2023 are:
- JP Morgan Chase (Expiration on 06/16/2023) $135.71 (Strike Price of $80.00) Current Deviation = 68.87%
- Essex Property Trust (Expiration 07/21/23) $216.06 (Strike Price of $170.00) Current Deviation = 27.09%
- Union Pacific (Expiration 08/18/23) $192.52 (Strike Price of $145.00) Current Deviation = 32.77%
- Huntington Ingalls (Expiration 09/15/23) $201.38 (Strike Price of $185.00) Current Deviation = 8.85%
- L3 Harris Technologies (Expiration 10/20/23) $175.92 (Strike Price of $150.00) Current Deviation = 17.28%
- Essex Property Trust (Expiration 10/23/23) $216.06 (Strike Price of $200.00) Current Deviation = 8.03%
- Marriott Hotels (Expiration 01/19/2024) $167.79 (Strike Price of $90.00) Current Deviation = 86.43%
- Norfolk Southern Corp (Expiration on 01/21/24) $208.18 (Strike Price of $145.00) Current Deviation = 43.57%
*Deviations > 25% are considered favorable.
Earnings realized during April/May/June 2023:
- Norfolk Southern – $1.35/Share, 100 Shares = $135.00
- Wells Fargo Bank – $.30/Share, 500 Shares = $150.00
1st Quarter Earnings Summary:
- Gains from Securities $20,412.00 *Comerica Bank
- Dividends 2,131.53
- Sale of PUT Option Contracts 1,840.00
Sub-Total 1st Quarter Earnings $24,383.53
© 2023, David J Hoare MSA. All rights reserved.
