Baby Bonds to Trade Today-Corrected

We have corrected the ticker which has been changed from the planned ticker.

The new OFS Capital baby bonds (NASDAQ:OFSSL) will begin trading today.  Of course depending on your broker they may or may not have their database updated.

OFS is a business development company (BDC) which has performed fairly well over the last couple of years and holds mainly senior secured floating rate loans.

This issue has a meager coupon of 6.375% but has a desired maturity in 2025.

We will be a buyer of these shares for various portfolios–models and personal.

We had done a modest drill down on OFS last week.

Our plan personally is to hold these until a weak economy is detected and at that point we would likely need to exit as we have little faith in BDCs holding risky loans in a weak economy.

19 thoughts on “Baby Bonds to Trade Today-Corrected”

  1. RILYZ (7.5% yield at par) is at a good price today, $24.90, but I already own a bunch of it. Hate to put too much in one company but, judging by the chart of RILY, the company must be doing very well. Any thoughts of buying this one and passing on OFSSL?

    1. Hi Leonard–I already have the RILYZ-a full position–BUT any Riley issue under $25 is likely buyable–I like them

      1. You think you are chicken, Tim, I own a big slug of RILYL. But will not muster the courage to buy the 10 year notes, lol… I recently bought a big slug of WFC-J with my strategy of “buy it and dare them to call” at $25.67. It today broke out of its tight month long $25.66-70 range today closing at $25.87. Since it is so liquid, mayne this is a sign word is getting out it will live to see another divi after this. This is the fun part of owning these types (the call watch wait the next couple weeks) as they are not going to drop much as market isnt giving anyone a free pass on 8% par investment grade QDI.

        1. I love the callable issues–many I own are callable and if they are called fine–if not they stick around liquidation preference. I am not looking for capital gains and am quite happy with the coupons.

      2. I own the sister issues RILYZ and RILYG, a little less yield, but with some time yet for call protection.

        Debating if I want to increase exposure to Riley and buy some RILYL, especially now that it is below par due to recent XD.

        1. Inspubudget I think you have the tickers crossed. RILYL is the short duration issue and is currently is an interest payment above par. I think you already own RILYL, correct?

          1. Grid, no, I do not own RILYL. I have the other 2 sisters, which mature in 2027. So they are longer duration, but no plans to sell right now..

  2. Hi Leonard–I have an order in for a bit of a lowball at 24.80–like you it may be a few cents better next week–but either way likely won’t run higher right away.

    Relative to the income threshold I don’t know about it–the majority of stock investments we own are all in IRA’s—we have a big chunk in an account earning 4.5% interest, which of course is ordinary income and this is not in an IRA.

  3. Tim, you buying today or watching to see if it drops into a better buy-zone? I think I will do the latter, plus it fits with my plan to put the ABRN-CL money to work when it becomes available. I’ve been thinking of selling SSW-G before it goes ex-div next week to raise some cash but after the SSW upgrade today, along with the fact that it is a qualified dividend, I’m thinking just to hang on. Anyone know the income threshold above which the 15% tax rate on qualified dividends no longer applies, i.e. you get taxed at 23.8%? Thanks.

      1. Hi Amy–thanks for the input–doesn’t look like I will have to worry any time soon–haha.

      2. Amy – thanks so much. Looks like I (unfortunately) don’t have to worry being taxed higher than the 15% rate.

        1. Yep…I thought the same thing….no worries for me reaching the 20% tax of QDI any time soon!

    1. Thanks wedgehead–didn’t catch that change from the intended ticker. I have corrected.

          1. Hi Tim,

            Thank you very much for this link. I had not thought to go back to the old site. I have not been back there since coming to your new site which I love!

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