wallner
Gold Standard
Puerto Rico senate approves bill to restructure utility PREPA By Reuters
Qualcosa di positivo, finalmente
Qualcosa di positivo, finalmente
Obbligazioni in dollari Keep Calm And Invest Preferred Shares Usa
wallner
Gold Standard
Olio di palma/Le certificazioni
Posto uno special del sole 24 ore sull'olio di palma.
Se ben ricordo c'è una pref inglese emessa da Corp. che produce olio di palma
Posto uno special del sole 24 ore sull'olio di palma.
Se ben ricordo c'è una pref inglese emessa da Corp. che produce olio di palma
NoWay
It's time to play the game
Fabrib
Forumer storico
Ciao NoWay, avevo letto l'articolo. Ieri sera ho preso le Qwest 7,5% che erano scese sotto la pari. Sono baby bond e potrebbero essere richiamate entro fine anno, mi è parsa una buona occasione.
NoWay
It's time to play the game
sparviero7000
Forumer storico
ieri le pref ing e Barclays sono andate sotto la parità
Joe Silver
Forumer storico
Aareal
Incrementato le pref a 24,94.
Incrementato le pref a 24,94.
sparviero7000
Forumer storico
ottimo
Fabrib
Forumer storico
Occasioni per YH:
Hunkered Down, Waiting for More Bargains
February 15, 2016 - 8:36am
To say that it was a difficult week for investors would be somewhat of an understatement, but we have gone through these periods many times in the last 45 years and there should be no doubt that panicking will leave you worse off than simply sitting tight.
While the year started off with “junkier” income issues (preferred stocks, baby bonds, REITs and MLPs) getting taken to the woodshed over and over, the most recent days have shown there is no place to hide as even the best of the best have been taken down 1-3%. The preferred stock of issuers like Public Storage and Wells Fargo, which had been rock solid, started to be tossed out in a fashion we have seen before ---”throw the baby out with the bathwater”.
Let’s look at how these type of market downdrafts develop. 1st off we have the realization that the economy, both domestic and globally, is weak. Anyone could see this was the case and in fact could see it many months ago. While the Fed raised the Fed Funds rate in December they now are beginning to back off their demands for future rate hikes. Investors sensing that as the economy weakens shares of those companies that are less than investment grade will be susceptible to capital loss, or worse, suspension of dividends/distributions. Investors in weaker issues either sell their shares and keep the proceeds in cash or they move the proceeds into issues of higher quality issues. Thus we see lower quality issues fall in price while investment grade issues stay even oreven move up a bit in price. As fear builds investors in even some of the highest rated issues begin to panic (or say to themselves they simply don’t want to be invested at this time) and sell their shares. The further down share prices fall the more investors run for the exits.
We understand the sentiment of income investors, but there is a huge problem with selling out of a mark because of fear. Investors that sell out of the market seldom re-enter or if they do they only do so after prices have recovered and moved higher. They successfully “buy high and sell low”. As many of us know as markets crashed in late 2008 and early 2009 with the S&P500 falling from around 1500 down to 800 retail investors were bailing out as fast as they could. They were setting themselves up for a perfect “buy high and sell low” situation. Many of those investors have never re-entered the market so they are forced to keep their money in CD’s and savings accounts at interest rates that earn just enough money to buy a cup of coffee each month. Of course a year later (January, 2010) the S&P500 had gained back 50% of the loss and income issues were just about back to were where they started. Those that held through the turmoil did just fine and those brave enough to step forward and buy at low prices made out like bandits. We are happy that we bought some issues during those scary times--but wished we would have bought more.
So here we are with some losses over the last week or two, but not of a magnitude that we find unsettling. Our blended income model portfolio is off 2.93% and if it weren’t for a couple disaster holdings (such as our lone energy MLP NGL Energy) we would be near breakeven. Even the more conservative Short/Medium Duration Income Portfolio is now up just 1.7% as it holds some issues which are non investment grade which have been sold down. As we survey the issues out there we see more that we would rather buy than sell. For instance Cowen Group has a baby bond (NASDAQ:COWNL) which now is trading with a current yield of 9.2%. Cowen Group, which is an investment bank, sports a stellar balance sheet. JMP Group, another investment bank, but with a less solid balance sheet has 2 baby bonds outstanding with current yields of 10.1% and 9.3%. TravelCenters of America (NYSE:TA) has 2 baby bonds outstanding now trading with current yields of around 9%. You can peruse the baby bonds available at this link.
While we are not buying at this moment, we may do so soon. We are watching a bit longer before making any new commitments. We did some purchasing 2-3 weeks ago of “bargains” and they have worked well thus far, but there is no reason to rush into new purchases as good bargains today may be great bargains tomorrow.
Hunkered Down, Waiting for More Bargains
February 15, 2016 - 8:36am
To say that it was a difficult week for investors would be somewhat of an understatement, but we have gone through these periods many times in the last 45 years and there should be no doubt that panicking will leave you worse off than simply sitting tight.
While the year started off with “junkier” income issues (preferred stocks, baby bonds, REITs and MLPs) getting taken to the woodshed over and over, the most recent days have shown there is no place to hide as even the best of the best have been taken down 1-3%. The preferred stock of issuers like Public Storage and Wells Fargo, which had been rock solid, started to be tossed out in a fashion we have seen before ---”throw the baby out with the bathwater”.
Let’s look at how these type of market downdrafts develop. 1st off we have the realization that the economy, both domestic and globally, is weak. Anyone could see this was the case and in fact could see it many months ago. While the Fed raised the Fed Funds rate in December they now are beginning to back off their demands for future rate hikes. Investors sensing that as the economy weakens shares of those companies that are less than investment grade will be susceptible to capital loss, or worse, suspension of dividends/distributions. Investors in weaker issues either sell their shares and keep the proceeds in cash or they move the proceeds into issues of higher quality issues. Thus we see lower quality issues fall in price while investment grade issues stay even oreven move up a bit in price. As fear builds investors in even some of the highest rated issues begin to panic (or say to themselves they simply don’t want to be invested at this time) and sell their shares. The further down share prices fall the more investors run for the exits.
We understand the sentiment of income investors, but there is a huge problem with selling out of a mark because of fear. Investors that sell out of the market seldom re-enter or if they do they only do so after prices have recovered and moved higher. They successfully “buy high and sell low”. As many of us know as markets crashed in late 2008 and early 2009 with the S&P500 falling from around 1500 down to 800 retail investors were bailing out as fast as they could. They were setting themselves up for a perfect “buy high and sell low” situation. Many of those investors have never re-entered the market so they are forced to keep their money in CD’s and savings accounts at interest rates that earn just enough money to buy a cup of coffee each month. Of course a year later (January, 2010) the S&P500 had gained back 50% of the loss and income issues were just about back to were where they started. Those that held through the turmoil did just fine and those brave enough to step forward and buy at low prices made out like bandits. We are happy that we bought some issues during those scary times--but wished we would have bought more.
So here we are with some losses over the last week or two, but not of a magnitude that we find unsettling. Our blended income model portfolio is off 2.93% and if it weren’t for a couple disaster holdings (such as our lone energy MLP NGL Energy) we would be near breakeven. Even the more conservative Short/Medium Duration Income Portfolio is now up just 1.7% as it holds some issues which are non investment grade which have been sold down. As we survey the issues out there we see more that we would rather buy than sell. For instance Cowen Group has a baby bond (NASDAQ:COWNL) which now is trading with a current yield of 9.2%. Cowen Group, which is an investment bank, sports a stellar balance sheet. JMP Group, another investment bank, but with a less solid balance sheet has 2 baby bonds outstanding with current yields of 10.1% and 9.3%. TravelCenters of America (NYSE:TA) has 2 baby bonds outstanding now trading with current yields of around 9%. You can peruse the baby bonds available at this link.
While we are not buying at this moment, we may do so soon. We are watching a bit longer before making any new commitments. We did some purchasing 2-3 weeks ago of “bargains” and they have worked well thus far, but there is no reason to rush into new purchases as good bargains today may be great bargains tomorrow.
