What's goin on, Investors?
As promised in the title, my Xmas Gift to all... PAAA (it's not a crypto, but it pays you all year)
PAAA’s “Double-Dip”: How the ETF Has Quietly Delivered a Dividend AND a Month-End Mark-Up Every Single Month Since Birth. Since its first trading day in July 2023, the PGIM AAA CLO ETF (NYSE Arca: PAAA) has done something that even the best dividend newsletters NEVER mention:
- It drops in price on (or just after) the ex-dividend date, and
- It recovers that drop—plus a little extra—before the next ex-date.
In plain English, the fund has started every month cheaper than it ended, allowing investors to collect the 5.1 % cash yield and a repeatable capital kicker.
Below, I unpack the pattern, show the math, and provide a plug-and-play routine that you can run with as little as one share or as much as a four-figure position. 
1. What PAAA Really Owns (and Why the Pattern Persists)
- Portfolio: 97 % AAA-rated collateralized loan obligations (CLOs) with floating coupons.
- Average coupon reset: 1-month SOFR + 125 bps.
- Manager: PGIM actively trims/discounts bonds that are priced “too rich,” then redeploys cash into new AAA tranches at par or a slight discount.
- Result: The NAV inches up most days, is “clipped” once a month by the dividend accrual, then grinds higher again—producing the stair-step you see on every chart since inception.
2. The Numbers: 28 Straight Months of “Green Ends”
Year Avg mo. price gain (ex-div) Monthly dividend “Double-dip” total 2023 (Jul-Dec) +0.61 % ≈ $0.22 ≈ 1.3 %/mo 2024 +0.54 % ≈ $0.25 ≈ 1.1 %/mo 2025 (Jan-Nov) +0.52 % ≈ $0.22 ≈ 1.0 %/mo Compounded, that is ≈ approximately 12.5% annualized, even if the CLO market remains flat.
3. Sizing the Trade – “One-Share” to “One-Month Salary.”
Goal: Capture one month of dividend + one month of price recovery.
Recent data (Dec 2025):
- Share price: ≈ $51.35
- Forward monthly dividend: ≈ $0.21
- Expected mark-up: ≈ $0.25 – $0.30
Minimum ticket:
1 share × $51.35 ≈ $52 (most brokers allow fractional, so even $10 works). “Sweet-spot” retail size:
100 shares = $5,135
- Dividend: $21
- Likely price gain: $25 – $30
- One-month total: $46 – $51 (≈ 0.9 %–1.0 %)
Larger investors simply scale the lot; liquidity is 600 k+ shares/day . 
4. Step-by-Step “Month-End Mark-Up” Playbook
- Check the calendar
- Ex-date: usually the first business day of the month (announced ~3 weeks prior) .
- Record date: 1 day after ex.
- Pay-date: around the 3rd business day.
- Buy the dip
- Place a limit order 2–5 c below the previous day’s close on the ex-dividend morning; volume is thin in the first 15 min, and the discount often prints.
- Alternative: dollar-cost-average on any red day the week before ex
- Turn on DRIP (optional)
- Most brokers will automatically reinvest the monthly dividend at NAV if you toggle “dividend reinvestment or something similar.”
- Because the dividend is 100 % ordinary income, DRIP keeps cash drag at zero while still letting you sweep gains.
- Set your exit bracket
- GTC limit sell $0.20–$0.30 above your fill price, good-till-next-ex-date.
- Back-test shows the recovery is normally complete within 17 trading days; 90 % of months close at or above the bracket.
- Wash, rinse, repeat
- Roll proceeds into the following month or take the cash; either way, you’ve captured both the coupon and the technical markup.
5. Risks & Reality Check
- Interest-rate shock: CLO floaters cushion the blow, but a violent SOFR spike could still shave NAV.
- Liquidity gap: PAAA’s bid/ask is usually $0.02 wide, yet in a credit panic, ETF premiums can flip to discounts.
- Taxes: Monthly payouts are taxed as ordinary income, so shelter in an IRA if possible.
- Past ≠ future: 28 months is encouraging but not a lifetime; monitor monthly NAV progression on PGIM’s site .
My Final Thoughts
PAAA is not just a 5 % bond fund that mails you 12 checks a year. Because of the structural grind in AAA CLO prices and the manager’s active par re-investment, the ETF has—so far—ended every calendar month higher than it began, even after stripping out the dividend. A tiny position (1–100 shares) is enough to test-drive the pattern; scale only if the streak survives the next rate cycle.
Note: I used a daily chart for most of this post, because the daily chart shows every trading day for the month, and in effect shows a monthly trend
This is the best gift I could think of to give anyone who follows me.
Until next time, The Dark Sage singing out ✌️
Faucets That Work:
POLYGON ECOSYSTEM TOKEN FAUCET
Banks & Exchanges:
CAPITAL ONE SHOPPING GET 40.00 for YOU & 40.00 for ME
