Issue No. 1
Spring
2000
Inside this Issue
- Introduction
to
the Funds
- Welcome
Susan Schwab--
Newest Member
of the Boards
- Introducing
the Managers--
Doug Ober
- Rewards
of
Dividend
Reinvestment
Introducing
the Managers
|
DOUG
OBER, Doug Ober heads the investment management team that oversees more than $2.6 billion in assets for Adams Express and Petroleum & Resources. He joined the companies as a research analyst, and became a member of the portfolio management team in 1986. He has been chairman of the companies since 1991. The fund’s conservative philosophy is central to security selection. “The companies we own meet our portfolio parameters for balance sheet strength, position in the industry, earnings multiple and long-term growth prospects. Even those stocks we own in the high-flying technology and telecommunications sector meet these criteria,” he says. These fundamentals have led to such investments as General Electric, Cisco Systems, Nokia, Nextel, Corning and Selectron. Mr. Ober is equally excited about the prospects for Petroleum & Resources. With oil prices at or near 20-year highs, he predicts that investor sentiment will catch up with prices in oil stocks, and the fund is poised to perform favorably. “There is often a lag of several months,” he explains. Petroleum & Resources is positioned to participate as oil stocks continue to benefit from the surge in prices. |
Contact Information:
Editor:
Investor Express
The Adams Express
Company
contact@adamsexpress.com
Seven St. Paul Street,
Suite 1140,
Baltimore, MD 21202
(410) 752-5900
(800) 638-2479
www.adamsexpress.com
Petroleum & Resources
Corporation
contact@peteres.com
(410) 752-5900
(800) 638-2479
www.peteres.com
| A semi-annual newsletter for our shareholders |
Introduction to the Funds
|
You may have received your first shares of Adams Express or Petroleum & Resources from a family member as a gift or an inheritance, or purchased shares upon a recommendation from a friend, as many of our shareholders reported in a recent survey. Whether you have held your shares for a long time or are a new investor, we take this opportunity to give you some basics about the two funds in this inaugural newsletter. Adams Express and Petroleum & Resources are two closed-end investment companies, traded on the NYSE, whose investment objectives are to preserve capital, generate dividend income, and provide opportunity for capital appreciation. We invest in the portfolios with an eye towards protecting your original investment and generating dividends and capital gains that can be used as a source of income, if you choose, or reinvested to increase your holdings in the fund. The portfolios are conservatively managed with the expectation that they will generate market returns with lower than market risk for shareholders. Both funds are “internally managed” and boast both low expense ratios and a low portfolio turnover. As closed-end funds, when a new security is purchased, another security must be sold to finance the purchase. This discipline sharpens our focus on each investment decision. |
Our research analysts look for investments that offer long-term earnings growth at a reasonable price. The analysts are keenly attuned to their assigned industries to identify the best investment opportunities for the funds. Their recommendations are then presented to the three-person investment committee, made up of senior management, and are reviewed by our Board of Directors. While the investment approach to managing
the two funds is similar, the funds are quite different in their
substance. Adams Express is a diversified equity investment fund
with a conservative philosophy that makes it suitable as a core
holding for long-term investors. Petroleum & Resources is the only
closedend equity fund that specializes in energy and natural resources
stocks and may be suitable for investors who seek a broadly-diversified
exposure to the energy sector. We’ll tell you more in upcoming newsletters. Your questions are welcome and will help to provide us with material for future issues.Please address your questions to the Editor, Investor Express, by telephone, in writing or by e-mail. Contact information is provided at the bottom of this newsletter. |
Meet The Newest Member of the Boards
| We welcome Dr. Susan Schwab, Dean of the School of Public Affairs at the University of Maryland, College Park, who was elected to the Boards of both funds in January. Prior to joining the faculty at the University of Maryland, Dr. Schwab was Director of Corporate Business Development at Motorola, Inc., where she was responsible for evaluation and negotiation of strategic alliances, including acquisitions and joint ventures on behalf of Motorola operating units. She also has served as an official at the U.S. Department of Commerce. |  |
The Rewards of Divendend Reinvestment
|
You may need to think twice before you elect to receive your dividends and distributions in cash. They can really add up over time when you reinvest them in additional shares. That’s what thousands of Adams Express and Petroleum & Resources shareholders have found by enrolling in a dividend reinvestment program for the funds. Hypothetically, if you had invested $10,000 in Adams Express on December 31, 1989, and took all of your dividends for the next ten years in cash, your original investment of $10,000 would have grown to $21,480 on December 31, 1999. If you had reinvested all of your dividends during that same period, the value of your shares would be worth $51,495*. That is due to the investment principle known as compounding. When you reinvest your distributions in new shares, compounding allows you to earn distributions on the reinvestment so that your money grows faster. The difference grows more dramatic over time. You can also systematically add to your share position to build value. If you had invested an additional $50 per month to your $10,000 investment over that same ten-year period, as well as reinvested all of your dividends, the value of your Adams Express shares would have grown to $68,535*.
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Two
Choices for Reinvesting Your Dividends and Capital Gains
(1) Reinvesting through our transfer agent, The Bank of New York. Of course, you don’t need to invest $10,000 to become a stockholder. New investors may enroll in The Bank of New York’s BuyDIRECT SM plan with an initial investment of $500. There is no initial minimum for current shareholders. You may make additional cash payments as often as weekly. If you wish to invest monthly, the Bank can electronically transfer $50.00 or more from your bank or money market account. It’s that easy. You can request a Plan brochure and enrollment form for BuyDIRECT by calling the Bank at 800-432-8224. (2) Reinvesting through your broker. Most brokers offer dividend reinvestment programs
through which your holdings of Adams Express or Petroleum & Resources
can grow. Contact your broker and ask to have your dividends and
capital gains reinvested through the plan sponsored by your broker.
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