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Anyone know how Elfun Trusts delivered 17.5% cap gains/interest?
Old 01-09-2019, 09:00 AM   #1
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Anyone know how Elfun Trusts delivered 17.5% cap gains/interest?

I received cap gains and interest of 17.5% ROI for FY 2018 (all reinvested). Given how the rest of my investments did, I'm wondering how they did it? I've owned this fund for years, but this is one of the best. The manager, Dave Carlson, is excellent, but I think this maybe surpasses anything I've seen from him in the past few years.

Granted, when they pay out those gains each year the price drops significantly, but not always in lock step with the gains. So I'm not looking at market cap (which is down a bit for the year), just the gains.

I'm considering putting a little more in this Fund, but I guess I don't understand how this fund works... is it different from how a typical fund works? Thanks!
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Old 01-09-2019, 09:24 AM   #2
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Depends on the fiscal year... if it ended in Oct everybody did great.
This doesn't look like 17.5% to me.
https://www.marketwatch.com/investing/fund/elfnx
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Old 01-09-2019, 09:44 AM   #3
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Nope, fiscal year ended Dec 31. I know, I saw that published return, which is what started me wondering... but I actually got 17.5%... doesn't make sense. To get ROI I divide the gains (number of shares) into the number of shares held prior to the gains. IDK, maybe they made a mistake? Doubtful. So I'm still scratching my head...
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Old 01-09-2019, 09:58 AM   #4
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you got to include price per share, not just number of shares... easier to just use value on date X vs. value on date Y.
USA Today did show a 17.5% return, but said it was below the S&P for the same period so obviously the time period used did not include December.


Ignoring all of that. The key question is if you don't understand the investment, why do you own it? (but then there is a reason I own very little outside of CDs, cash, and FDIC MMs).
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Old 01-09-2019, 10:01 AM   #5
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Originally Posted by guitarguy View Post
Nope, fiscal year ended Dec 31. I know, I saw that published return, which is what started me wondering... but I actually got 17.5%... doesn't make sense. To get ROI I divide the gains (number of shares) into the number of shares held prior to the gains. IDK, maybe they made a mistake? Doubtful. So I'm still scratching my head...
That's shares, not $. I don't care about shares. I can't eat them.
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Old 01-09-2019, 11:28 AM   #6
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It's still a very nice 15.1% cash ROI on div date of 12/27. Still pretty darn good.

I was hoping that someone who has quite a bit of experience with the inner workings of this particular fund would chime in. I've owned this for about 40 years, in varying amounts... it was only available to GE employees and their family, my father gave me a few shares when I was a kid. So it's not that I don't understand the investment as a whole, I'm trying to learn about this one point. I'm certainly not omniscient, but I understand their investment strategy, their low admin costs, their returns, their holdings, their cap gains... and Carlson is highly respected with an impressive record. I also really like the tax advantage of cap gains over dividends. So I guess the crux of my question is, because it's a "Trust" does that affect the price change after cap gains declared, or is it completely market driven like others.
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Old 01-09-2019, 11:56 AM   #7
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A quick tour thru Yahoo historical prices shows it tracks the market closely :

year close adjClose distribe payout totalReturn
2018 $51.72 $51.72 $8.111 15.7% -6.4%
2017 $64.36 $55.26 $6.517 10.1% 28.3%
2016 $55.55 $43.06 $4.709 8.5% 19.3%
2015 $50.60 $36.08 $4.485 8.9% -2.3%
2014 $56.05 $36.94 $5.466 9.8%

They probably sold some big long term winners this year.
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Old 01-09-2019, 12:26 PM   #8
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They probably sold some big long term winners this year.
Thanks, that's the only thing I could come up with too.
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Old 01-09-2019, 12:31 PM   #9
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It's still a very nice 15.1% cash ROI on div date of 12/27. Still pretty darn good.

I was hoping that someone who has quite a bit of experience with the inner workings of this particular fund would chime in. I've owned this for about 40 years, in varying amounts... it was only available to GE employees and their family, my father gave me a few shares when I was a kid. So it's not that I don't understand the investment as a whole, I'm trying to learn about this one point. I'm certainly not omniscient, but I understand their investment strategy, their low admin costs, their returns, their holdings, their cap gains... and Carlson is highly respected with an impressive record. I also really like the tax advantage of cap gains over dividends. So I guess the crux of my question is, because it's a "Trust" does that affect the price change after cap gains declared, or is it completely market driven like others.
Nothing magical to see.
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