Eaton Vance Tax Managed Diversified Eq. (ETY)

NetscribeETF (90.15) Submitted: 3/29/2007 9:28:54 AM : Start Price: $13.97 ETY Score: +14.66

Eaton Vance Tax-Managed Fund is primarily a diversified equity based income fund which is closed-end in nature. The funds objective like most of its peers boasts of current income gains and much sort after capital appreciation. Its strategy seeks mainly to minimize and defer shareholder federal income taxes by evaluating the returns on after tax basis. The funds approach involves investing at least 80% of its total assets in a combination of dividend paying common stocks and common stocks, the value of which is subject to covered written index call options.
Taking a view of the funds investment one can observe that, with more than 90% of the funds allocated in the highly developed markets of U.S. and U.K., it imbibes certain level of security to its investments. Further, considering the high dividend yielding pattern of most of its key investments, it gives a strong moat to the fund for a risk averse investor.
The sector allocation of the fund is more tilted towards financial and utility sectors, that has a strong correlation with the over all economic growth. Looking ahead in 2007, the on going housing downturn is expected to ease off by second half of the year, which will have a positive impact on the GDP. Moreover, its top ten holdings consist of high performing giants like Verizon Communications, Citigroup, and Exxon Mobile, which together account for around 25% of the over all investment. This portfolio makes the fund a very good target to generate a sizable capital appreciation in the long run, while with risk management driven strategies like covered call in place it will also provide the investors with the desired security, making Eaton Vance Tax Managed fund a strong investment.