Dan Plettner seeks to exploit inefficiencies in Closed-End Funds and other under-followed exchange-traded securities across multiple asset categories. He first entered the Investment Industry directly out of college in 1997. After achieving “NSD award” as retail Financial Advisor at Morgan Stanley Dean Witter, he relocated to Morgan Stanley’s International Headquarters in Manhattan where he served as a Closed-End Fund Product Specialist until 2000.
He emphasizes "qualitative research" in seeking to identify potential valuation changes among underfollowed securities. He believes that readily available “quantitative research” used by median market participants is of minimal value for achieving outsized returns in any associated investing style.
Dan manages Covestor's Core model, which aims to provide significant risk-adjusted total return outperformance versus the S&P 500.
Every set of market opportunities is unique, and the allocation discipline is dynamic. Concentration and diversification have contrasting benefits and detriments. The model balances each to the market environment. The model is opportunistic at both the micro and macro level, embracing a higher risk profile (less balanced among asset classes) when suitable. Allocation to a certain security or set of securities is likely to be most significant when research convictions are greatest. This model is long only.
Dan recently sold Cohen & Steers Infrastructure Fund Inc (NYSE: UTF) from this model. We had a chance to ask him about his sell decision. His response:
Rather simple closing of a Closed-End Fund relative value trade.... UTF is a rather straight forward equity Closed-End Fund. Its market price relative to its net asset value went from cheap when purchased to relatively rich. And, there are numerous opportunities I'd like to add.
Here's Dan's recent Covestor webinar, where he describes his methodology: