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Another Kind of Quiet Day – 1 Purchase Today

Well it is another kind of quiet day–common shares are off, but just by .37%–essentially unchanged. The 10 year treasury is up 9 basis points–trading at 4.61%. All in all I like watching paint dry–just collect dividends and interest and not have to worry about capital movement.

As I mentioned earlier today I planned to buy some of the SiriusPoint 8% reset preferred—I think this is a ‘sock drawer’ holding now with good financials reported yesterday and a current yield and yield to 1st call of around 8% hopefully the share price behaves itself (trades flattish). With the reset spread at over 7% in 2/26 which is added to the 5 year treasury one would have to believe the company will call the issue at the 1st available time (2/26)–of course a lot can happen in 2 years. I had to pay $25.19 to snag some shares.

11 thoughts on “Another Kind of Quiet Day – 1 Purchase Today”

  1. I think you ended up doing better than you thought on your purchase, Tim….. YTC at a purchase price of 25.19, assuming call on first available date of 2/26/26, I believe gives you a YTC of 8.44% once you back out the .417 cents of accrued…

    1. 2WR, when does dividend accrual start for stocks? Is it on XD day, or Pay Day?
      I have been using Pay Day to do my calculations, but am not sure if this is correct.

      1. @Inspbudget,
        I believe PD is correct; I just got this notification from another of my holdings, though of course not all companies may follow this scenario:
        “(…) the board of directors of the Company declared a Preferred Stock cash dividend of $0.50 per share for the period commencing on September 15, 2023, and ending on December 14, 2023. The dividend is payable on December 15, 2023, to holders of record on December 1, 2023”

      2. Dividend/interest accrual on baby bonds begins on the pay date. XDiv date is merely a date that determines who is entitled to the upcoming dividend. There are legit mental reasons x-div date can enter into your calculation, but officially, it’s pay date to pay date (actually pay date to day before pay date). For calculation purposes, an example of when x-div date is important would be if you buy on x-div date, and in this example assuming x-div is 15 days before pay date. Then there will be 15 days from your date of purchase that you will not be receiving accrued. In most cases, that’s only significant if you’re calculating yield on a very short maturity, meaning measured in months to maturity, not years…

        BTW, I have come across exceptions to this rule, but they are very few and far between and, as always, are spelled out in the prospectuses

  2. Bought some SiriusPoint. Ex dividend of $.50 in the next couple of days for an effective discount. 😁

  3. Tim ; there is almost 3 months of accrued dividends baked into that price ; my strategy with many pfds priced over par is to wait till ex date or later to buy in ; if we get a repeat of events 3 months ago, ide expect buy at around 24.50 ; i use the charts a lot for guidance

    1. Maybe not- on Aug 14 it dropped only 30¢, and only 19¢ May 12th. Lost 20 and 31¢ on those. At 25.18 now, it looks like one could do pretty well.

    2. Hi ted – I’ll take the little ‘bonus’ – I planned to buy so getting some accrued divi is just a bonus for me.

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