JERICHO, NY--(Marketwire - February 11, 2011) - Cornerstone Strategic Value Fund, Inc. (
| Record Date | Payable Date | Per Share | |||
| CLM | April 15, 2011 | April 29, 2011 | $0.1278 | ||
| CLM | May 13, 2011 | May 31, 2011 | $0.1278 | ||
| CLM | June 15, 2011 | June 30, 2011 | $0.1278 | ||
| CRF | April 15, 2011 | April 29, 2011 | $0.1112 | ||
| CRF | May 13, 2011 | May 31, 2011 | $0.1112 | ||
| CRF | June 15, 2011 | June 30, 2011 | $0.1112 |
Each Fund's distribution policy provides for the resetting of the monthly distribution amount per share ("Distribution Amount") annually, based on the Fund's net asset value on the last business day of each October and the annualized Distribution Percentage approved by the Boards. Each Board previously announced that the Distribution Percentage for the calendar year 2011 would remain unchanged from the previous year at 21% of the net asset value of each Fund.
Each Board of Directors believes that each Fund's distribution policy maintains a stable, high rate of distribution. These distributions are not tied to the Fund's investment income or capital gains and do not represent yield or investment return on the Fund's portfolio. The Distribution Amount from one calendar year to the next will increase or decrease based on the change in each Fund's net asset value. The terms of each distribution policy will be reviewed and approved at least annually by the respective Board of Directors and, as always, can be modified at their discretion for the benefit of the Fund and its stockholders.
Each Fund's Board of Directors remains convinced that its shareholders are well served by a policy of regular distributions which increase liquidity and provide flexibility to individual shareholders in managing their investment. Shareholders have the option of reinvesting these distributions in additional shares of the Fund or receiving them in cash. Shareholders may consider reinvesting all or a portion of their regular distributions through their Fund's reinvestment plan. Shareholders should carefully read the description of the dividend reinvestment plan contained in each Fund's Reports to Shareholders.
Under its policy, each Fund may distribute to shareholders each month a minimum fixed percentage per year of the net asset value or market price per share of its common stock or at least a minimum fixed dollar amount per year. In determining to adopt this policy, the Board of Directors of each Fund sought to make regular monthly distributions throughout the year. Under each policy, the Fund's distributions will consist either of (1) earnings, (2) capital gains, or (3) return-of-capital ("paid-in-capital"), or some combination of one or more of the above. A return-of-capital is the return of a portion of the investor's original investment.
Given the current economic environment and the composition of each Fund's portfolio, a substantial portion of each Fund's distributions made during the current calendar year is expected to consist of a return of the investor's capital. Accordingly, these distributions should not be confused with yield or investment return on the Fund's portfolio. The final composition of the distributions for 2011 cannot be determined until after the end of the year and is subject to change depending on market conditions during the year and the magnitude of income and realized gains for the year.
In any given year, there can be no guarantee that the Fund's investment returns will exceed the amount of the net distributions. To the extent that the amount of distributions taken in cash exceeds the total net investment returns of the Fund, the assets of the Fund will decline. If the total net investment returns exceed the amount of cash distributions, the assets of the Fund will increase. Distributions designated as return-of-capital are not taxed as ordinary income dividends and are sometimes referred to as tax-free dividends or nontaxable distributions. A return-of-capital distribution reduces the cost basis of an investor's shares in the Fund. Stockholders can expect to receive tax-reporting information for 2011 distributions by the middle of February 2012 indicating the exact composition per share of the dividends and distributions received during the calendar year. Stockholders should consult their tax advisor for proper tax treatment of the Fund's distributions.
Under the managed distribution policy, the Fund makes monthly distributions to shareholders at a rate that may include periodic distributions of its net income and net capital gains, ("Net Earnings"), or from return-of-capital. If, for any fiscal year where total cash distributions exceeded Net Earnings (the "Excess"), the Excess would decrease the Fund's total assets and, as a result, would have the likely effect of increasing the Fund's expense ratio. There is a risk that the total Net Earnings from the Fund's portfolio would not be great enough to offset the amount of cash distributions paid to Fund shareholders. If this were to be the case, the Fund's assets would be depleted, and there is no guarantee that the Fund would be able to replace the assets. In addition, in order to make such distributions, the Fund may have to sell a portion of its investment portfolio at a time when independent investment judgment might not dictate such action. Furthermore, such assets used to make distributions will not be available for investment pursuant to the Fund's investment objective.
Cornerstone Strategic Value Fund, Inc. and Cornerstone Total Return Fund, Inc. are traded on the NYSE Amex LLC under the trading symbols "CLM" and "CRF," respectively. Each Fund's investment adviser is Cornerstone Advisors, Inc., which also serves as investment adviser to another closed-end fund, Cornerstone Progressive Return Fund (
Past performance is no guarantee of future performance. An investment in a Fund is subject to certain risks, including market risk. In general, shares of closed-end funds often trade at a discount from their net asset value and at the time of sale may be trading on the exchange at a price that is more or less than the original purchase price or the net asset value. An investor should carefully consider a Fund's investment objective, risks, charges and expenses. Please read a Fund's disclosure documents before investing.
In addition to historical information, this release contains forward-looking statements, which may concern, among other things, domestic and foreign markets, industry and economic trends and developments and government regulation and their potential impact on the Fund's investment portfolio. These statements are subject to risks and uncertainties and actual trends, developments and regulations, in the future and their impact on the Fund could be materially different from those projected, anticipated or implied. The Fund has no obligation to update or revise forward-looking statements.
Contact Information:
Contact:
Cornerstone Strategic Value Fund, Inc.
(513) 326-3597