I chose to add an issues off the ‘hiding place’ list this morning–it went ex dividend today so was marked down to a good price for me. Of course I should have bought yesterday when 2whiteroses and others mentioned it in comments–it was trading at $25.22 or so — I would have been ahead 7-8 cents by capturing the dividend.
I bought the Wesbanco 6.75% fixed rate reset perpetual preferred (WSBCP) at $24.88/share. There is a high likelihood that the issue will be called 11/15/2025 as it resets at the 5 year treasury plus a spread of 6.557%.
Once again this is just part of my long drawn out process of raising my overall portfolio yield—slowly, but safely. Thus far my portfolio is performing about as I expected–moving slowly higher.
A suggestion: RITM-D. It’s an mREIT on a lower-risk level with NLY and AGNC. 7.00% coupon rate with a flex rate of five-year Treasury + 6.223% starting 11/2026. It has fallen to $23.83. It’s almost sure to be called 11/2026, so a nice income and upside. Overlooked because other RITM preferreds are floating right now over 9.0%.
RITM-D went ex-div today. . .
Wilson,
ATLCL sort of falls under that same category. Matures 11/30/2026. Selling for a touch over 24 today. Only pays 6.4%ish at that price but good enough considering the maturity date. During down days often able to be picked up slightly below 24. I have been slowly adding to an existing position with loose change now and again.
For the truly brave may I suggest FOSLL trading at 14.75, yielding 12.1%, and matures 11/30/2026? If anyone can figure this one out it will be quite the pay day. If FOSS comes up with a plan this will jump to 20+ over night.
I will sheepishly admit I own 303 shares of FOSLL since it IPO’d. Not my finest moment but it has paid and I pray it gets redeemed. Every time I think about taking on more risk with it I have refused to double down on my stupidity.
fc
You are not alone as FOSSL holder and I am counting the days until maturity.
This is a reset I have been holding since Oct. Not just for the possibility of a call, but because of the reasons discussed here.
If rates fall, then high yielding preferred the owner will re-finance at lower rates and issue a new preferred at the lower rate and call the other. Lower yielding re-sets based off 5yr Treasury might lock you into a lower rate for 5yrs which is why I have a mix of 3 months SOFR resets. If rates fall, the resets may still be ahead of new issues coming to market at lower rates.
No one knows where rates are headed but I heard a conservative analysis on the radio said even with the cuts DOGE has made government expenditures increased 250 billion in the first qtr. If we get a budget out of Congress with all the pork barrel tax cuts that have been promised I fear the debt owed will increase without the income coming in to pay for it.
Short term, and with a recession rates might go down but longer term who knows? I am not looking forward to lower rates.