Bond Discussion

This is a page where bonds can be discussed. I am thinking primarily $1,000 issues which are of interest to folks.

Like the other discussion pages posts will stay intact for a number of months.

1,273 thoughts on “Bond Discussion”

  1. JP Morgan is all the way down to calling CDs @ 5.15% coupon… Fido just notified on CUSIP: 46657VEX4
    Description: JPMORGAN CHASE BK N A CD 5.15000% 07/30/2025 to be called 1/28… I bot a slew of JPM CDs when they were leading the pack in yields on 1 yrs, assuming most would be called and they have been… This is the lowest coupon so far that I’ve seen…. Thank goodness I found Synchrony selling CDs at the same yields and at the same time but non callable. So the 5.50% Plus CD gravy train continues at least partially for the next 4 months or so… Also got a a few days extra from earliest call date on 3130B1U62 FEDERAL HOME LOAN BANKS BOND 5.97000% 07/17/2034 CALLABLE 01/17/25 @ 100.000 getting called on 1/28/25.. Cash is building up for me and it’s probably too high as it is right now.

    1. Thanks 2WR I bought a few FHLB that have a first call in Jan. that I haven’t checked. Was just a place to park some money. If they are called not sure what I will do with the money as I am feeling it’s still not the time to be reinvesting it.

      1. Well you made me look 2WR, I have a 6%FHLB and tomorrow is 1st available call and 1st payment is 4/25/25 so I was hoping to get called on first payment date figuring I would have a better idea what is happening with the market.

        1. Well 2WR looks like I survived first call. Thanks for the heads up from LT. I forgot Monday morning is a good day for Bond trades. To be honest, with my tolerance for risk I bought some EIX bonds with a maturity in 4 years. Was interesting to look at Fido’s bond offerings going out 14 to 20 years saw more oil, pipeline and mining bonds than I have seen in a long while and discounted to Par with yields over 6.3% YTM I was getting tired of looking as all that was being offered on Fidelity was REIT and BDC bonds for quite a while. Oneok and Teck ( a Canadian mining co. ) both probably down on future economic and tariff concerns.

          1. Bought some of those 2029 EIX bonds yesterday. Teck is a very good Canadian company. You can’t go wrong owning some of their bonds if you find the right combo of yield and duration.

              1. Yes…sorry. Weekends don’t count. I think in terms of market days.

                I just bought some 2041 TECK Resources bonds. I was looking at them last Friday when I pulled the trigger on EIX. Thanks for the reminder.

                1. Richard your welcome. I don’t know how the company is run now, but been in business since 1913. I was tempted.
                  Interesting how all the different factors come into play with bonds and the different companies. Right now my concern Copper is holding up price wise for now but will demand? Especially from China who has been a major user. Then there is the question of tariffs not just on Canada.
                  I was looking more at the Oneok bonds being safer with a pipeline co.

          2. If you like a little risk with your bonds and don’t mind stepping into the less than investment grade realm, take a peak at Genworth Holdings Make Whole 2034 issue. Coupon 6.5% Yield 6.85% so even though it could be called, it’s trading below par. Moody’s has raised its rating on the issue three times in the last few years and the ratings outlook is positive.

            1. I should add that I bought some of these last week. Also bought US Steel Corp. 2037 6.65% just under par. Again, this is below investment grade. US Steel has excellent liquidity.

              1. Richard, Thank you for the suggestions. I have been wanting to go farther out on the time horizon. Fidelity keeps telling me I have a short term outlook on the mix of holdings in my wife’s account. But a lot of the investment grade is out 25 to 35 yrs and the returns don’t seem worth the risk.
                Not the same, but I look at MGR giving a current YOC (yield on cost) and not due until 2059 as 6.35%

                1. I own some of the 2034 Affiliated Managers bonds. Fidelity doesn’t show any longer dated issues for them. 🤔

                  I mentioned a few below investment grade holdings that I own. It’s not where I concentrate but sometimes value can be found there.

                  Ford 2032
                  V F Corp 2033
                  Genworth 2034
                  US Stl 2037

                  Amongst my 27 corporate bonds in the portfolio.

                  I think one could look at Paramount and maybe Goodyear if you’re willing to stick your neck out a little further.

                1. Thanks 2 whiteroses for the link.

                  All true! The key point is there needs to be a change of control (sale or merger). My feeling is that US Steel will not be sold. Nippon’s bid is in the dust bin and opposed by both the former and current administrations. Cleveland Cliffs would like to buy it but they tried that once before and were rebuffed. The more likely scenario is simply a change in leadership. I could be wrong but that’s the way I see it. Any redemption will net me any accrued interest as I purchased essentially at par. Definitely a holding where one has to keep up on company specific news. Not a sock drawer issue!

                  1. Richard – I only mentioned the call because I had the info at hand so thought anyone looking to buy should be aware of it – as a plus, not a negative…. I looked into this issue in Aug ’23 so had the prospectus on this one and another US Steel 6.875% due 3/1/29. I think I chose to play the ’29 issue to for a takeover even though this had the better potential. When the play topped out, I sold out, but I continue to watch X. If I had to guess and guess is absolutely all it is, X WILL be sold or parts sold off, but domestically, not to Nippon…

                    1. Thanks for your thoughts. I could absolutely see that scenario. I’ll be paying closer attention to this one than I do most of my holdings. Who knows…maybe the government will consider this a national security issue and find some way to preserve the company. Thanks again!

    2. Consider some 5 year Best rated A++ annuity?
      Mass Mutual is at 5%
      A+ issuers at 5.15 -5.40.
      A- you can get 5.40 two year. 5.50 3 year
      The Corebridge A+ Best rated five year 5.15 annuity can be cashed out at any time subject only to a market value adjustment based on rate movements. I looked the other day and mine has an upward adjustment as rates are still below where they were when I purchased it.

      https://www.dplfp.com/products/products-overview/myga-marketplace

    1. Is this Allstate floater a preferred or bond? If preferred, is it qualified dividends Thanks

  2. This one works for me… JPM Chase bond issued 12/13/24 cusip# 48130CWJ0…paying 5.5%…due 12/13/39…1st call 12/26…yield to call 5.745%

  3. I am baffled by the sheer incompentece of brokerages relating to corporate fixed income securities.
    It’s one month Schwab is saying one of my baby bonds (CIMO) is a preferred and as such payments are dividends not interest!
    As a foreign investors I prefer baby bond because there’s no withholding.
    I sent Schwab the description of the security (it clearly says senior notes due 2029) and the prospectus but they insist it’s a preferred! More it takes ages before they answer my mails. It seems customer relationship is getting from bad to worse.
    Is Fidelity better? Is it possible like in the good old times to have the direct contact of an employee and solve the issues smoothly instead of wasting so much time for nothing?
    Thanks for reading my rant

    1. Gabe, are new hires getting older with more experience or younger and less experienced. Try asking for a senior dept. head. call instead of e-mailing.

    2. Gabe, YES Fidelity is much better. In my experience, they have more adequate staffing. Employees don’t leave as often, I’m told.

    3. same happened to me with IBKR but two months later they fixed the withholding.
      more you insist it’s a bond and more thay insit it’s a preferred.

    4. The dirty little secret of the industry is that they almost “all” rely on a single vendor to provide reference data, but are too cheap to challenge that data when it is wrong, since it takes time on their part.
      (Did you think those free trades are actually free?….)
      But there is a bigger problem.
      Depending on the back office platform, some of the older ones (like Schwab’s) can’t handle a baby bond that trades on the stock market and conversely also can’t handle a preferred stock or MLP that trades on the bond market. One trick they use so the trades are not assessed accrued interest is to stick PFD in the description.
      At the end of the day, the person to complain to is the tax people saying that your 1099 is wrong because a bad 1099 is much easier to fix and has much of a penalty attached than a bad trading setup, which would definitely lead to FINRA fines.

  4. I’m a beginner when it comes to bonds, and I could use some pointers to get me oriented. Where are people here buying these bonds? What tools do you use to find out about them? What commissions are typical? Are online quotes even possible?

    To make it concrete, on a SA thread about Ready Capital’s new RCD baby bond, someone mentioned that RC had an OTC bond that recently traded at significantly higher yield. Maybe it was one of you? They gave this FINRA link: https://www.finra.org/finra-data/fixed-income/trade-history?cusip=75574UAB7&bondType=CA

    Here are some of my questions: If you didn’t already know the CUSIP, where would you find it? What’s the difference between the CUSIP and the Symbol? If one wanted to find a current price for this, how would you go about it? Which online brokerages would allow you to buy it? How much commission would one typically be paying? Is there an offering statement that gives the exact terms for this bond?

    As you can tell, I don’t really even know which questions to ask. Direct answers are great, but pointers to appropriate websites, books, or blogs that answers these types of questions might be even better. I’m not actually looking for direct instructions on how to quickly buy this particular bond. I’d just like to learn more about this side of the market that I know very little about.

    Thanks!

    1. Do you have an account at Fidelity? If so, go to News&Research/Fixed Income, Bonds&Cds and snoop around…. The more you snoop, the more you’ll find available to you to answer your questions…. Finding Ready Capital there is going to be problematic at best because they are not rated and would be below IG even if they were….. But even though you don’t see any bonds initially below IG rating in Fido’s initial chart, you can actually create your own search there for all bonds or any specified maturity range or date…… You can also grab the CUSIP number once you are looking at a specific company’s bonds….. And if you don’t see what you want, you can also call Fido fixed income and ask what they might be able to see….
      You can also usually check a company’s 10k to find their outstanding bonds.

      As mentioned, you can find a lot from a company by going to FINRA and searching… There are experts on here on using FINRA… And if you’re really desperate to find the original if you know or can guess the year of issuance, you can search EDGAR https://www.sec.gov/search-filings for the original document….

      1. Nate, 2white roses will tell you I’m no expert, he has forgotten more than I will ever learn. When I teach a class on grafting trees I tell new grafters there is no wrong way unless the graft doesn’t take. It’s more of practice to gain the skills.
        The link you got from SA is like looking at the rear end of a sports car, doesn’t tell you a whole lot.
        2WR gave you one way to look by using Fido. You can look up bonds on Fido and see real time quotes if you have the CUSIP but if it’s not in their inventory then you have to call their bond desk and see if they can find some available.
        FIDO will also show you the lots that sellers want to sell at. A few people here have mentioned bonds offered at a $250,000.00 minimum buy. This is outside my maximum.
        Start here under quick filters. Sometimes it takes a while to load so be patient. I have it bookmarked.
        https://www.finra.org/finra-data/fixed-income/corp-and-agency
        You have to enter the name of the issuer for example what is the name of PPL? Then you have to enter it as how the software programmer set it up.
        An easier one is for CODI Compass Diversified
        But wait! if you type in the whole name the search engine will not find the bonds. Instead just type in Compass D
        Ok one last thought. say someone is talking about some company’s preferred stock or Baby bonds and you want to see if there are bonds that are available.
        If there are, then you do the next steps 2WR suggested to dive deeper to see if they are senior, subordinated, etc.
        If you want PM me on SA

        1. I had you in mind when I mentioned experts on using FINRA, Charles… I still have your previous instructions in my notes…..

    2. Nathan-
      I had all of the same questions when I started bond investing in 2022. By bonds I mean the ones that are issued at $1000 each with a par value of 100 and trade by CUSIP number. If your brokerage (mine is Schwab) is making a market in a particular CUSIP, you can by it online, otherwise, by phone order.

      Before you start, you need to know the goal of your bond investing. For me, it’s to buy bonds with a good yield, a low risk of default and hold them to maturity. I include in my choices treasuries, brokered CDs, IG bank notes, agency bonds, and IG corporate bonds. The latter three have been my sweet spot. Only bank notes and corporates present any real credit risk to be concerned with.

      I don’t really care at what price my bonds are trading in the secondary market. Sometimes the mark-to-market value puts me at a loss and sometimes a gain. I’m holding to maturity and love receiving the interest payments. However, on occasion I’ve sold a low coupon bond when the price is right. Also, when my bonds are at a loss, it can be a great time to buy bonds on the secondary market below par and on sale.

      When looking at a bond, first I want to know the coupon, due date and call date. Calls can be continuous from the call date, or if not called, reset at some fixed interval, like six months, to a new call date. Some bonds have a make whole provision, meaning they can be called at any time but you will get some extra compensation for not receiving the expected interest to maturity. There are other more esoteric provisions that occasionally show up.

      When buying bonds on the secondary market (not new issues), you’ll pay the accrued interest in addition to the asking price and fees, if any. When selling bonds, you’ll receive the accrued interest. Baby bonds are much like CUSIP bonds, except they trade like stocks and don’t include the accrued interest as part of the trade settlement.

      1. Thanks rock, I was afraid I would get too long winded trying to cover everything. The part you said about knowing your goal and picking the field you want to invest in is important.
        Swimming in the bond market ocean is different from other markets. A lot of times if a company’s bonds are discounted or high yield this is telling you the bond traders see risks you don’t.
        Two years ago there was a lot more variety in the bonds Fidelity was holding in house for sale. Same as other markets, when there is a panic there are more options on the table. This past year BDC’s and REIT’s showed they were serial issuers and that was all Fidelity seemed to offer.
        Schwab also sells bonds but I didn’t find their system as user friendly as Fidelity at least for me starting out.

      2. Nathan,

        I am a neophyte also. There have been some excellent and enlightening replies to your post. One area that I don’t think it’s been touched upon is that different brokers have differing bond offerings in the secondary market. For example, I do not think Fidelity does allow you to trade reset rate or floating rate bonds. That forced me to open up a account at IBKR. Each brokers software is quite different and I suggest you find one that suits you.

    3. Nathan Kurz,
      Interactive Brokers showsa bid /ask spread in more bonds than any other retail brokerage site of which I am aware. There are many ATS (electronic bond trading platforms) and IB displays a composite quote of best bid/ask for many of these.
      There have been times I’ve had a bid below the lowest bid displayed, or an offer above the highest ask, and I’ve been filled because the other side of the trade doesn’t have access to all the ATS’s.
      IB charges a few buck per month for the bond quotes and a few for bond ratings. You can run screens on the entire marketplace. I have one for unrated Nevada bonds. These would never show up on Fidelity or Schwab sites.
      IB does not display secondary market agency securities in my experience.

      I truly hate IB because they appear horribly understaffed , so it might seem odd I’m directing you there.

      1. losingtrader, I actually like the secondary market as over time you can see how the bond trades or the whole group of bonds for one company trades. Sometimes you can find a price discrepancy between one bond and another of the same company.
        Here is a Grid special. Their credit rating is not the best , but is a utility due in 2029 He would bounce between the Capitol trust III and IV
        This is what the buyers are offering, doesn’t mean the seller has to take it. You see the minimum shares you have to buy to get that price. This is one you have to call in at Fidelity.
        Bid Yield Qty(min) Bid Price (Sell)

        6.260 500(50) 92.900

        6.284 125(2) 92.815

        6.385 250(10) 92.456

        6.635 10(10) 91.576

        1. I actually posted the above not for LT who is an expert, but for others. As a electric utility bond of a company that was bought by AES the rating doesn’t bother me as I figure people in a major US city are not going to go without their lights and Netflix.
          I am slightly underwater as Rocks mentions it doesn’t matter as I intended when I bought it to hold for maturity.
          My Fido nanny keeps telling me my holdings are weighted heavily to the short term end of the scale.
          I’m also posting this as an example of what Tex said happens when 10yr treasuries stay high that lower coupon bonds lose value. This is a 4.35% bond.
          At one point in Oct 2023 it hit a low of 80 ($800.00) and a almost 9% yield
          So this is why I take bond ratings with a heavy dose of skepticism.

        2. So when you call in to Fidelity to ask about this one, what name of the issuer do you give them??? Or do you just ask for the Grid special??? lol

          1. Dayton power & light
            You try typing in the whole name nothing shows up. So you try Dayton. OOPS !
            now you get everything named Dayton. Next try typing in just Dayton P
            That works, but it only shows recent issues under that name. So what gives?
            Who is the parent company? (Note) sometimes typing in the acronym doesn’t work, you have to type in the actual name like I did for DPL ( Dayton Power & light)
            I complained to 2whiteroses before you have to wonder how the programmers thought about setting this system up.
            Here is the link again to the starting page
            https://www.finra.org/finra-data/fixed-income/corp-and-agency

            Play around with it folks. You’re never going to learn how to use it if I do all
            the work! Use Google AI to figure out the names of the companies and who owns what.
            Anyone wonder if Berkshire has issued any bonds? you might find the bonds are cheaper to buy than shares of the company. Then you can brag to your friends you own bonds in Berkshire.
            Once you find the CUSIP # you can call the bond desk. Hint, pronounce it Q-sip
            Helps give the impression you know what you are doing. I was pronouncing it like cuffs on a dress shirt. Showed I was a newbie

              1. Dan, this is exactly why I said doing research and looking into the company is actually fun for me as I learn a lot from doing a little detective work when I am looking at the bonds.
                It got me curious when I saw the AES Argentina bonds as the country’s economy has improved.

    4. Thank you all for the helpful comments so far!

      I don’t currently have access to Fidelity. Between my wife and myself I have access to Vanguard (seem good for Treasuries and Agencies, but weak at least online for everything else), Wellstrade (theoretically possible to trade by phone but nothing online), ETrade (some things online but not much?) and Schwab (I don’t actually know what they offer). Is Fidelity clearly better than these?

      I was planning to move the ETrade account to IBKR next year for international access. I opened the ETrade account a few years ago to take advantage of a bonus, and haven’t found them particularly good or bad otherwise. It’s good to hear that IBKR has advantages for bonds as well.

      I spent the morning reading the first third of Annette Thao’s “The Bond Book”. The online references are a bit dated, but the general background is helpful for me. The realization I got from it today was that YTM may exaggerate the advantage of one bond over another, since there is no particular reason to expect to be able to reinvest the dividends from the higher yielding bond at a better rate than a lower one.

      It seems like a good book: very readable, accurate as far as I can tell, pitched at an appropriate level for me. Does anyone have any other good book recommendations for background?

      1. Nathan-
        If you buy all your bonds new and at par, the YTM is the coupon yield. If you buy on the secondary market at a price above or below par, your first concern should be current yield (CY). The CY of a fixed 6% bond bought at 99 is 6*100/99 = 6.06%; that’s the yield your bond will earn at each interest payment.

        If you hold a bond to maturity (HTM) and you paid less than par, you will also realize a capital gain. A bond purchased for $990 will have a $10 or 1.01% capital gain. YTM numbers include this cap gain/loss and will differ from CY, sometimes by a lot, a red flag for me.

        Suppose you find a bond with 15 years to maturity, a CY of 3.5% and a YTM of 6%. Almost half of the gain for this bond won’t be paid to you for 15 years. In the meantime, you will receive a measly 3.5% annually. And after inflation, how much is that cap gain really worth? Could be a lot less.

        My general rule for maturities of two years or less is to buy for YTM and ignore a lower CY. For longer maturities, I buy for CY. I want the cash flow to reinvest now.

        1. “Suppose you find a bond with 15 years to maturity, a CY of 3.5% and a YTM of 6%. Almost half of the gain for this bond won’t be paid to you for 15 years. In the meantime, you will receive a measly 3.5% annually. And after inflation, how much is that cap gain really worth? Could be a lot less.”

          Having heard this point of view before, it makes me think that those making this point think that a bond trading at a discount to par reaches par all of a sudden and all at once as it gets to maturity…. That of course is not the case. Take your specific example as a test case. A 15 year bond due 12/30/39 that has a 6% YTM and a 3.50% CY has a 2.20% coupon. That’s your specific case because it’s a 1k 2.20% bond due 12/30/39 yielding 6% that trades at a price of 62.76 that would have a 3.50% current yield.. That’s quite a discount! Anyway, let’s assume interest rates don’t change in a year’s time. You want to sell your bond at your same 6 % YTM, even though a normal upward sloping yield curve might make it even worth a lower YTM than 6% as a 14 year bond than it was as a 15 year bond….. What price would you get on your sale? You’d get 64.35 not 62.76. That’s a 2.53% gain on price plus your interest rate return you earned…. So you don’t have to wait 15 years to get paid you cap gain – you’ll see its value gradually increase over time on your balance sheet every year – that is if you’re in an ivory tower like stable interest rate environment where no other factors enter the equation. You get it gradually over the time whether you take it or not……. Sometimes, I think this part of bond math is frequently overlooked when comparing a bond trading at a substantial discount to its more par like brethren….

          As we all know the likelihood of interest rates being exactly the same over a 1 year are pretty slim….In this example, if interest rates went down, of course your cap gain would be greater than this example…. But what happens if they go up? The 2.20% coupon bond gives you a little cushion because your bond could lose 22 basis points in YTM (meaning you could sell at 6.22% YTM instead of your original 6% YTM cost) before you’d lose a dime of principal…

  5. Recent discussions here on III about where rates are headed and the price of preferreds and BB relative to bonds has gotten me curious.
    I don’t have a tracking or alerts set up for bonds but looking at several I have had an interest in the past I see in Oct of 2023 where prices and yield were at their best. I don’t think we will revisit those prices but it would be nice if they came close.
    What I am talking about is not shorter maturity but longer term bonds. Perpetuals and long term BB prices have been falling recently, maybe I can finally feel comfortable about holding some longer term bonds if they fall in price too.

  6. TBB, the AT&T baby is trading at 24.15.
    The yield appears to be only about T+.75 bps on 40+ year BBB debt.
    That’s crazy expensive, especially if you are subject to state income tax.
    Is this perhaps a big holding of a bond fund ??
    This was 22.57 on July 24th, with the 30 year treasury 20 bps LOWER.

    I realize T stupidly called it’s other baby bond into a rising rate market, so this could be called, but it seems like shorting this and buying the 20 or 30 year T or even an A+ preferred at 6.1 is a good trade

  7. This morning I was hit on 50 Nevada Special Improvement District #612 cusip 51778was1 due in 2050 at a 5.55 YTM (discount bonds) at 79. The value to debt on these is 20-1 as of 6/30/23, but it’s not that secure as debt is assessed by parcel and can default by parcel , subject to the reserve required to be maintained. SID bond debt “runs with the land” and is not extinguished by a tax sale. Roughly 20 % of the parcels had improvements as of the 2023 report. I am not familiar enough with the development to know what’s happened in the past 17 months but I”ll work on getting the data fro AMG, the company that services payments for all the districts

    There are typically prepayments of principal by homeowners who don’t like having to make payments on the SID debt, and $100k of this issue was redeemed at 103 recently.
    Notably, if the dealer who bought these from a customer at 77 had excerised a best execution obligation , that dealer would not have bought the bonds at 77 and flipped them to me 2 points higher.
    Honestly I had just thrown in a bid on these when there was a higher offer. Likely I could have bought in the 60’s, and I’m lowering other bids where I can.
    I don’t really want to own more munis but will buy at SOME price./
    Reoffering at 85, but I am willing to hold forever

    1. Lt, Outside the risks you describe, would you say as an indication of where the prices of these bonds are trading reflect what the buyers and sellers think rates are headed? at least for now? What I mean is lower prices give the buyer a higher yield on cost and a higher yield on maturity because of the capital gain capture. At least in my position if I was looking 25 years out which is a lot of time and no idea what can happen in that time I would want a higher return on investment.

      1. Charles,
        If you’re referring to the NV infrastructure bonds, not the TBB I posted on,
        they are so illiquid most typically don’t trade at all after issuance, so I’d guess there are just a handful of people like me in the state and 1 or 2 dealers willing to bid. Dealers wanna flip so individual buyers mainly want a clearly great price without thought of future rate moves.
        Also, there’s no capital gain. The 21 points below par becomes ordinary income at maturity because the de minimum rule is inapplicable. I’ve never calculated the time value of the par discount over the remaining maturity, but my hope is more of these are paid off at par by individual parcel owners.
        If you pull up the bond on emma you can see the various redemption notices.
        This one also has a sinking fund over the last 6-7 years.
        I hope I answered your question

        1. Yes Lt I was asking about the NV bonds. The sinking fund is to your advantage I assume. Kinda like the ability of Corp. bonds having a constant call option.
          I have been getting into bonds with the thought of holding to maturity and I have seen the early call feature of some noted. I figured the early call feature was of no concern unless I lose a nice interest payer or I got caught when the bond is over par which I would never buy in the first place.

  8. Happy Holidays my fellow III income friends; I am back at the tax free happiness window and purchased:
    4.25% Idaho Housing Finance Single Family due 7/1/2038 Moody’s rated AA1 and underlying rating AA1 CUSIP 45129Y3P9 @ $99.387 YTW/YTM 4.30% and YTC/YTS 4.32%. Please due your own deep due diligence as this tax free bonds fits my safety/volatility/maturity income ladder (though the bond may be called any time). All the very best, I am Azure

    1. Good Morning AB,
      An excellent purchase for the term length.
      Housing bonds are one of my favs. As mentioned I’m merely waiting for some clarity on “pay-fors” on the TCJA extension as muni -bond interest exemption could be whacked. The market doesn’t seem to think so, but I have too much tied to munis right now.

      1. LT, unknowable what will happen to taxation of muni interest. My two highest probable outcomes would be:

        1) No changes
        2) Limit maximum amount of tax free interest that can be claimed by each taxpayer. Kind of like the SALT limits.

        There is one upside/downside depending on which side you are on. If all muni’s became taxable with correspondingly higher interest rates, pensions and insurance companies would buy a boatload of them. Currently tax free is not a benefit to them, so a whole new set of buyers would immediately show up.

        1. Tex, with re: to SALT. It has been interesting watching the very well off people that live around me squirm when SALT became effective. I was able to bypass somewhat as I’m one of those people who owns the worst house in the neighborhood (northern Virginia suburbs). But it was interesting watching people react to this. Most neighbors don’t vote the way I do, well, I’ll be honest, none of them do. So when it came time for them to pay up they were pissed. It was an irony for the ages as I imagine most of them have given a lecture or 5 on how the rich need to pay up. Not as noticeable or public perhaps, but I can imagine this muni tax scare doing likewise mind games on some people.

        2. Tex my friend, IMHO taking away or changing the tax exemption of tax free bonds issued by states and local governments would destroy their budgets/balance-sheets and I don’t believe their will be any change from the current tax exemption. Many cities (states are Constitutionally barred from any form of bankruptcy) would have to go bankrupt (or have major issues) as the cost to borrow would go dramatically higher.
          For more than 200 years, state and local governments have issued bonds to fund capital investments. The first municipal bond was issued in 1812, by New York City, to fund a canal. Throughout the 1800s, state and local governments were the primary investors in public infrastructure, building railroads, canals, highways, water and sewer systems, school buildings, and other improvements. During this time period, the municipal bond market grew rapidly. The question of whether the federal government should tax interest on municipal bonds was first raised following the passage of the Wilson-Gorman Tariff Act of 1894 (I studied this in law school in my Forming the Constitution class) . This bill established the first peacetime national income tax, a levy of 2 percent on all income over $4,000. Importantly, the new income tax also applied to interest income from state and local bonds.
          Less than a year later, the U.S. Supreme Court ruled the new income tax unconstitutional, in the very famous case (always cited) of Pollock v. Farmers’ Loan & Trust Co. (1895). The primary reason for the decision was the Court’s finding that the new tax violated Article I, Section 2 of the Constitution, which requires that all direct taxes be apportioned among the states according to their population. However, the Court also touched on the issue of municipal bonds, arguing that a federal tax on state and local bond interest would be unconstitutional.
          Regarding municipal bonds, the Court held that levying a federal tax on state and local bond interest would violate the constitutional doctrine of intergovernmental tax immunity: the principle that federal government cannot impose a tax on income derived from the activities of a state. Explaining this logic, Chief Justice Melville Fuller (look him up, just an incredible man) wrote, “The tax in question is a tax on the power of the States and their instrumentalities to borrow money, and is consequently repugnant to the Constitution.”
          Less than two decades later, the Sixteenth Amendment was ratified, allowing the federal government to levy income taxes on “incomes, from whatever source derived.” While the plain text of the Amendment seems to allow for federal taxes on income from municipal bonds, proponents of the Amendment argued that this was not part of its purpose. For instance, Sen. William Borah (R-ID) commented, in 1910, “To construe the proposed amendment so as to enable us (the Congress) to tax the instrumentalities of the state would do violence to the rules laid down by the Supreme Court for a hundred years and will wrench the whole institution from its harmonious proportions…”
          Following the passage of the Sixteenth Amendment, the Revenue Act of 1913 enacted the current income tax and specifically excluded municipal bond interest from taxation. Almost immediately, this provision attracted controversy from those who believed that it gave an unfair borrowing advantage to state and local governments. The Coolidge, Harding, and Hoover administrations all supported amending the Constitution to explicitly eliminate the tax exemption of municipal bond interest. In other words you would need to change the Constitution and specifically change the 16th Amendment (not going to happen in any form).
          In Latin we say, nullus Deus damn modo hoc fiet
          Smile, Azure

          1. AB,
            I hope you’re correct about how the law would play out, because I think you’re absolutely correct about the budgets of the various entities.
            Most of what I own is housing bonds, with a side of Texas schools and a bunch of NV unrated improvement districts.
            I do have bids for some of the NV ID bonds, but IB only allows a bid to be placed when there’s an offer outstanding. So at some price I’m willing to buy .

  9. Any recent thoughts on the Maiden baby bonds to support their interest payments. They are continuously reporting losses quarter after quarter but MHNC appears to have held a key volume support area around $17 recently with a yield of 11%+. I don’t see this as a long term hold, but any material risk in the next 1-2 years?

    1. No opinion on Maiden.
      This is orthogonal.
      We all follow support and resistance to some degree. However, I question whether that actually has any value whatsoever. This is not a criticism of you, legend.
      It’s just I’ve never seen anyone present a study showing technical analysis works. I’ll admit is SEEMS to work, sometimes.
      I’ve googled for it over time and couldn’t find anything. Perhaps I missed it, but one would think over all the decades people have used TA someone would have done a double blind study showing a positive correlation. Instead , TA appears more like tarot card reading .( Please don’t tell me that works; I’ll regret having not paid for it).

      My OPINION is TA is for people who don’t have the capability to understand financial statements or don’t want to read the footnotes to those. Actual analysis requires learning and time. It can make your head hurt so I understand the desire to simplify. TA is a little like religion, except there’s no God. I’m not sure what one is praying to other than simplification

      1. losingtrader-
        I could show you a zillion charts on which price action responds to Fibonacci lines. I could also show you another zillion on which I can identify Elliott Wave patterns. This is all empirical, not voodoo.

        The stochastic oscillator is useful for spotting oversold/overbought conditions. A slow-forming daily MACD divergence can help identify a major turn.

        The reason this stuff works is because the big shops are all looking at it and using it.

        I don’t trade. I’m a bad trader. TA doesn’t make one a good trader. I use the TA tools so I can put a “You are here” X on the map. Very helpful.

        1. I am not sure if I should comment on this because it can end up in a flame war of opinions but lets discuss the stochastic oscillator (SO) since it is easier to understand. In simple terms it is a momentum indicator.

          Everyone knows a single stock of a company can go up and down depending on how many buyers or sellers in each camp during that day. There will always be fluctuations in price with absolutely zero fresh news of what might be going on in a company short of insider information for a normal investor.

          So if the SO shows a value of 10 from being oversold with no news I can see why someone might think that is a good time to buy assuming they know what is going on with a company via their current financial statements. But what if they don’t read those statements and just read a 5 sentence blurb on SA about them on occasion when released? Do they just assume that great name everyone has been talking about is now on sale even though the quarterly report that came out 20 days ago has some information buried on pages 24 and 48 that should make one skeptical of their current bright sunny outlook?

          It really does seem a deeper understanding of the public company is necessary to use SO effectively. Otherwise you just have a lot of people saying, hey, this stock is cheap now I am going to buy! It trades in high volume, everyone is talking about it, and I think I can sell it for slightly higher next Tues. Is SO really that magical when anyone who watches a specific company’s stock price daily can tell it has lost value over a period of time? It is common sense really.. It just turns into gambling. The greater fool theory.

          A lot of this stuff to me, personally, is a form of gambling. Fib lines are the same thing in a way. Oh look.. people seem to buy it when it hits 50 per share. Lets call that resistance. Why do they buy it at 50 though? What makes it a value at that level from a financial perspective with all known current information? Or is it coincidence?

          Now if I had to program a trading bot (program) I would most likely have to use some strategy using math. Computers are good at that stuff. So if enough people do these things we get into a self fulfilling prophecy. All our bots are looking at the same data yet have no real understanding of what is going on with the actual company. Now I have to start programming in actions based on news as it is released. Now that can start getting tricky. If the news is released in a way my bot cannot understand or has an actual mistake in it… oh boy.. that will break me horribly. (We have seen that in real life btw). Let’s not even get into how the market can be terribly illogical for periods of time.

          In the end.. understanding the company really well is probably more important for the average investor compared to SO, fib lines, etc… Like LT said it is like trying to find a short cut to success. Some simple thing you can do to not read 100s if not 1000s of pages of information over a year or two to get a really good grasp of what is going on with a specific large company and then keeping up with it quarterly over a longer period of time. Yet that is where Wall St has been heading. Take that quarterly report from a paid for service that gives you priority access, summarize it in a fraction of a second, and get that bot taking action. Everyone using the same data. Same charts. Same everything. Except that human piece to try to understand more deeply where things are going.

          eh.. i am rambling a bit. I like SO, fib lines, etc.. I enjoy it. The math behind it. It is just that some authors take it way to far. They almost read like they are psychics. Tarot card readers but with charts. They go way beyond just saying a single company is oversold and start trying to make grand statements over longer periods of time. They often bash any criticism and gush over people who adore them via comments making them feel wicked smaht.

          1. How long has TA been used?
            As long as I can remember and well b4 that I’m sure. There’s still no double blind study proving it works?

            IMHO (and I’m not really humble but I like abbreviations), the reason TA isn’t a long-term profitable strategy is that those who use it are a target for someone with the opposite agenda.
            I think for every example where TA works, there’s one where it doesn’t .

          2. fc-
            I watch the SO for stock index futures, treasury bond futures, DXY and other major macro assets. I’m never surprised by a turn.

            1. fc- agreed. I look at a chart for trends and I look at the current market and past market for not only the stock but the segment of the market that company is in. Heck I even throw in what the weather is doing if it’s important. I read the conference calls but I should listen. You can tell a lot from the speaker’s inflection if they are twisting the truth. I skim over the quarterly report only because there is a lot I don’t understand. So at that point it is more of a gamble, but a lot in life is.
              But like you the one thing I don’t believe in is the people who interpret charts to the point it sounds like they are reading Tarot cards.
              Don’t forget though even with all the information that tells you a company is solid and is a good investment it can all go out the window when the herd senselessly panics.

  10. Greetings all! Has anyone seen any quality institutional qualified preferreds lately trading or paying at least 6%? (I see the new issues are 5.5ish).

    I have some other positions to replace.

    Cheers.

    1. YH-
      Here are 3 floating subordinated bonds you can checkout. Not exactly what you asked for.
      ALL 020002BB6
      PPL 69352PAC7
      NRUC 637432MT9

      Maybe these preferreds come closer.
      ET 29273VAM2
      ET 29273VAJ9
      STT 857477CH4

      Or the GS and C preferreds. This info might not be current.
      https://www.goldmansachs.com/investor-relations/creditor-information/preferred-stock.html
      https://www.citigroup.com/rcs/citigpa/storage/public/Series-CC-Final-Prospectus-Supplement.pdf
      https://www.citigroup.com/rcs/citigpa/storage/public/Series-DD-Final-Prospectus-Supplement.pdf

      Let us know what you find.

      1. r2s —-ET 29273VAJ9 do you know how the variable rate is calculated? I searched finra and schwab and couldn’t find the calculation. Thanks.

            1. I’m not clear how that plays out for tax purposes. I had a partnership at one point in the past where my CPA said the deposits I made into the partnership to pay for health insurance , since the business had no revenue, were guaranteed payments for the use of capital, and, as such, I had to pay tax on the money I put into the partnership.
              Maybe this will all change when everyone is no longer worried about IRS, after Elon’s RIF.

              1. IIRC, Guaranteed payments for use of capital are taxed essentially as interest. You get a K-1, but it only has data in one box . I am on the road so I can’t look at which box, but it is not like a “regular” K-1 in terms of complexity. Very simple to deal with. I have several issues that issue those (including from MLPs).

          1. r2s—the calculation you mention is for the series B. The prospectus outlines both series A and B for this issue. How does one know which is which, because there is only one cusip #? Was series A called previously? Thanks.

    2. Hey Yield. Too many to list. Can you narrow down the criteria a bit: risk tolerance, duration/maturity preferences, qualified vs interest, fixed vs float, any sectors you prefer. Also, which broker do you have, as not all issues are available everywhere. And would you be open to $25 par if they met the criteria?

      1. Hey Maine,

        I always appreciate your posts as well as everyone that commented here. Thank you for all of it. I am quite open to anything including $25 and I have accounts with most of the US brokers as each seems to offer a few different OTC issues. I just have noticed that there seems to be a bit of extra yield given to those willing to call into the bond desk and buy in increments of 1K. That is overly generalized though.

        My perfect world is qualified, long duration or perpetual, fixed unless there is a nice margin above whatever benchmark the issue is linked to.

        I’ve learned a ton from all of you on here and might be a bit younger than average but still wish I had discovered this world much earlier. A decent base of a dividend machine has been coming together over the last 2 years. It is disproportionately linked to perpetual, fixed, cumulative utility illiquid. I feel these are pretty safe in that they have some elements of monopolies and I don’t see them going anywhere. I would like to replace some other holdings that are less safe/less perpetual.

        Too much information?

        1. Hey Yield, sorry for the tardy reply. Longer duration and qualified is def on my wish list as well, slim pickings in the 1,000 par space. I think this Schwab issue is OK enough., offered at 95.9 on IBKR now.

          At 95.9, YTC is ~6.5%.

          From October 31, 2017 to, but excluding, December 1, 2027, 5.00%, and from and including December 1, 2027, three-month LIBOR plus a spread of 2.575%

          https://www.sec.gov/Archives/edgar/data/316709/000119312517319429/d481003dfwp.htm

          I also like the new issue Citi: https://www.sec.gov/Archives/edgar/data/831001/000119312524265665/d893156dfwp.htm

          or the 19075QAC6 Cobank, offered around 100.5

          lastly, I am not sure if this is qualified , but this BNS issue is currently floating (3MSOFR +291) and below/near par, callable though. https://www.sec.gov/Archives/edgar/data/9631/000119312517303538/d468757dfwp.htm

          1. Maine, how far out does a bond issuer have to notify a holder if they are calling a bond? I’m looking at one coming up on it’s first call 12/22/24

              1. Thanks Justin I found it. I have to read it and decide if I want to go with it as it has been continuously callible since 2023
                I wouldn’t buy until after payment date at I wouldn’t want to pay the accumulated interest.
                Really slim pickings in bonds. As far as I am concerned. 4-1/2 to 5% and a lot over par as far as the eye can see 15 to 20+ years out.
                Is the market really that stable? Just a short while ago banks were holding low interest notes and loans and selling them at a loss.
                I get 4-1/2% on a investment grade bond that I have to hold for 20 years seems risky in a way.

                1. Pickings are definitely slim. You are on the point I mentioned the other day.

                  If you are going to accept 4.5% for 20 years, you might as well buy treasuries. They pay just over that rate today at essentially zero risk. Not recommending it – just saying that many long term corporate bonds don’t make much sense at the moment.

          2. Maine,

            do you have a link to the the 19075QAC6 Cobank prospectus?

            I’ve been wondering for sometime….. Why Is the COBANK Financial information not accessible from the SEC EDGAR site? Am I doing something wrong?

            1. I don’t. My understanding is they aren’t registered w the SEC. I’ve been wondering the same thing- where is the offering doc w the terms?

              1. Goggle’s AI, Gemini says,

                “COBANK is a Farm Credit Bank, which is a type of cooperative financial institution. These institutions are not required to file financial reports with the SEC, and thus their financial documentation is not publicly available on the SEC EDGAR website.”

                I have emailed a request for the prospectus…..

              2. Cobank’s predecessors were chartered by congress about a hundred years ago to do ag financing. I believe that is why they don’t file with the SEC.

                You can find their history on their website.

            2. Is 19075QAC6 Cobank a preferred and if so, which series? I do have prospectuses for E, F, and G – wish I could remember how I got them…

                1. Of course it is……….. lol… Now I REALLY wish I could remember how I got these 3 because I could them possibly help you find the one you’re looking for, but me no gots…….

                    1. Thanks, Justin. I tried Julie about 12 days ago, no reply. Just re-sent to include all. BTW, anything of interest lately? always enjoy your insights.

  11. Late notice received. Lumen is buying back there 156686AM9 bond at $1000 or hold it till it matures 12/25 at 7.2%. Deadline 11/15/24 6:30 pm.
    I originally bought at $970 so not much gain.

    1. Also 156700AZ9 LUMEN buy back at $1000 and 156686AM9 at $932.50.
      Happy with the $932.50 since I only paid $620.

    1. Justin-
      “Floating rate based on Compounded SOFR (calculated as described in the Preliminary Prospectus Supplement), minus 0.35%”

      I didn’t look at the prospectus, but I’d guess the rate would be close to the FFR.

      Does the put turn this bond into something like a MMF? The CY might be bad at some future time, but you can get (most of) your principal back. Wouldn’t be surprised if the price quickly falls to 98.

      1. Does anyone definitively know what today’s “Compounded SOFR” rate is? I looked quickly and unsuccessfully to find it, but whatever it is, I imagine it must have a 4 handle on it…. not much extra meat on the bone to rely on a put for market value for 50 years imho….

            1. I think Compounded SOFR is a term made up by Gorgia Power to satisfy their needs, probably some form of hedging. Probably won’t find it published anywhere, but they do give you the formula and it appears to be backward looking so you don’t know the interest/dividend payment until close to payment date.

              1. No matter what, I think the formula, especially taking into account the -35, means what they will be paying is not much different than money market rates….. Don’t think I’ll be jumping up and down to get in or going back to math class to figure out what the exact rate is going to be.

                1. why would anyone buy this when they can get a FHLB security at SOFR+ a small margin?

                  1. I kind of agree, lt, but the reason would be because theoretically the put allows you to control the maturity date for at least the first 30 years.

  12. Florida Rail Brightline’s Riskiest Munis Lure Investors on Expansion Bet
    Railroad’s unrated muni bonds gain about 13% since April
    John Miller fills First Eagle’s muni portfolio with the debt

    Bond investors are snapping up the riskiest chunk of Brightline’s debt in a wager on the private railroad as it expands west across Florida.
    Investors, drawn by a 12% coupon, have bid up Brightline’s $925 million of unrated-tax exempt bonds so much that they’re valued at about 105 cents on the dollar. They’ve returned some 13% since April, when the Fortress Investment Group-backed company refinanced its debt with nearly $4.5 billion in muni bonds and junk notes.
    Among the reasons the unrated debt is appealing to investors: collateral. They’re secured by a lien on current and future assets including design contracts, permits, and rights-of-way that are earmarked for Brightline’s project to stretch its tracks from Orlando to Tampa.
    It’s a bet on the future of rail in traffic-clogged Florida for the first new US private passenger railroad in more than a century. With the two cities and Miami among the fastest growing US metropolitan areas, Brightline is planning to extend its trainline west connecting the state’s three major economic centers as soon as 2028.
    “We believe this to be the only debt that is secured by the Tampa route,” said John Miller, head of the high-yield muni credit team at First Eagle Investments. “This route is more valuable than the $925 million in debt and worth more than that to Fortress and the Brightline holding company in particular.”
    Read more:
    Brightline Founder Eyes Private Rail Expansion to Texas, Seattle
    Bankers Reap $15 Billion of Muni Deals From Florida Growth Boom
    Fortress-Backed Brightline Asks Investors to Bet on Florida Rail
    The veteran municipal-bond investor, who made a name for himself with his high-risk, high-return strategy, has been a long-time Brightline bull. He first championed the project while still head of Nuveen’s muni-bond investments, where he built the biggest high-yield muni fund. Since Miller joined First Eagle, the firm has bought $125 million of Brightline’s unrated debt, making it the $4.2 billion fund’s biggest position.
    And yet, it’s Brightline’s $2.2 billion of investment-grade senior municipal bonds that get paid first. Also higher than the unrated debt in the payment waterfall is $1.3 billion in high-yield corporate notes. Those trade around 91 cents on the dollar, a loss of some 4% since the refinancing, data compiled by Bloomberg show.
    Brightline hasn’t said how it plans to raise capital for the extension to Tampa, but a lien on the assets would result in a higher cost of capital. To remove the lien on the Orlando-to-Tampa project, Brightline has to buy back $500 million of the unrated munis, according to offering documents. Brightline’s financial projections include a $500 million redemption in 2025.
    There are other incentives for the railroad to refinance this debt early. The price to redeem the unrated bonds keeps increasing. The next hike on July 15, 2025 will increase the redemption price to 106 cents on the dollar from the current cost, 103 cents. It will then rise to 109 cents in July 2026. Brightline has two years after that to redeem the bonds.
    For potential investors in Brightline’s unrated muni debt, when they expect the debt to be redeemed is critical. A current buyer paying 106.5 cents may have a portion of the bonds called at 103 cents, some at 106 cents and some at 109 cents, Miller noted.
    “If a buyer’s average redemption premium is around 107 to 108 on a weighted-average basis, then in that scenario, the total return over the holding period would exceed 12% which would be very attractive in most markets,” Miller said.

    Another facet of the bond’s appeal is its scarcity value. Only $225 million bonds in the $4 trillion muni market have coupons higher than 12%. For an investor in the top federal tax bracket, a 12% coupon is equivalent to a taxable security yielding a little over 20%.
    Even though high-yield muni funds only make up 16% of municipal fund assets, investors have poured some $14 billion into high-yield munis funds this year, accounting for 44% of all inflows to municipal bond funds, according to LSEG Lipper Global Fund Flows.
    “Forty-four cents of every dollar has gone into a high-yield muni mandate this year,” said James Welch, a portfolio manager at Principal Asset Management. “That’s really the story.”
    On the supply side, a little over $20 billion of high-yield munis have been issued this year, just about 5% of total muni sales.
    Meanwhile, Brightline’s ridership has missed projections.
    The Florida trainline carried 2 million riders, or 2.7 million annualized, through the first nine months of 2024. That trails Brightline’s projected base case ridership of 4 million in 2024. Ridership on its short-distance line from Miami to West Palm Beach has fallen 38% because the railroad wants to ensure it has enough seats for higher-priced trips between Miami and Orlando.
    Still, Brightline has almost $1 billion in reserves available to service the debt on the $2.2 billion of senior muni bonds and the $1.3 billion corporate notes. Reserves are sufficient to pay debt service for two years. To boost capacity and revenue, Brightline has ordered 15 coach class cars and 10 premium class cars.
    And the muni market has shown its willingness to rollover Brightline’s debt, first issued in 2019.
    “Brightline for years has been behind projections and it never trades badly,” said Dan Solender, director of tax-free fixed income for Lord, Abbett & Co, which owned $27.5 million of the 12% munis as of June 30. “There’s definitely some market support for it, which might not exist on the taxable side.”

    I am NOT long these Brightline bonds (yet), I am Azure

    1. Thanks for this , Azure. I’ll be looking at Brightline West when it comes to market . I’m not quite sure they have the most efficient routing, but I know I’ll use this all the time.
      I know Brightline West has factored into many Californian’s “expatriation” to Vegas. By no means the biggest factor, though.

      1. well, I’m apparently behind as they’ve issued quite a few bonds already as I just checked emma

    2. I know this project well. My dear friend was President and now she is in charge of the West line. Encourage all if interested to request confidential financial statements via Brightline. I give no opinion.

      For those that like these high risk look at other Fortress debt. I did great on NFE bonds and am in the 29 bonds. GMPLF and Drive Shack preferreds are also Fortress. My dear friends are savvy. (Which is why I always invest in FIG PE.) Even introduced to a local friend and now they co-own sports team.

      1. Fortress is a lot bigger than Riley. Drive shack went BK and the preferred took a lot of investors money. I read a recent article on the railroad from LA to Vegas. Round trip Air fare from Burbank to Vegas is about $100.00. Amtrak is a little over $200.00 and takes 6 to 7 hours I think. Brightline West is expected to take about 2-1/2 Hours
        Sections will pass through federal land controlled by the Bureau of Land Management and National Park Service.
        Here is something to read with your morning coffee folks. People who forget history are doomed to repeat it.
        https://www.historyisaweapon.com/defcon1/zinnbaron11.html

        1. Charles, Drive Shack did not go BK. It stopped paying preferreds. Wes hired an individual with relevant experience to run DS. The individual spent foolishly. Wes allowed individual to resign. Turns out the individual was manic with serious issues. The person running now is proven. Blackstone entered with a competitor similar to DS. It is a long runway to success for DS. However, there is lots of loss carryforward which is valuable to Fortress. I sold years ago but do watch this space. I like the smaller entertainment venues vs the TopGolf (which is what DS originally tried to develop). TopGolf has been a disaster for Calloway.
          As far as Fortress taking investors money, I have stated repeatedly Wes understands the public markets. I generally go with his PE deals.

          1. Wanda, I didn’t do a deep dive on DS when I was looking several years ago. Just didn’t look good to me. My daughter worked for ClubCorp and quit when it was acquired by Apollo. Too much change and cut backs.

  13. Does anyone know of any upcoming or recent institutional high yield preferreds that are investment grade (I am thinking of stuff like the 7.2% Citi 5 year to float offering from earlier this year)?

    Maybe there are some interesting CUSIPs that people might suggest are worth taking a look at?

    The CUSIP for the Citi issue is: 172967PJ4

    1. YH—all the high yield ones I bought earlier this year are way up in price. I hesitate to add at prices like 104-107. Do you know of any website that posts $1000 institutional bonds? I have been looking, but can’t find any. Thanks.

      1. YH – Check out daily holdings from the large ETFs to source ideas.
        I then plug them in IBKR or FINRA to get a sense of pricing.
        I agree w Whidbey, most have run up too much. But I have still been buying a select few near par, not knowing where rates will go.

        Check out:
        38141gb52 – Goldman
        89832qae9 – Truist
        693475bp9 – PNC

          1. I have full position in the LNC security. Here is an interesting structure on investment grade elect utility Southern Co, SO 1000 face. 4% coupon floats 1-15-2026 at 5yr tsy plus 3.73. Can be had for under par cusip 842587DF1 fwiw!

            1. jerrymac—regarding SO 4% issue, I can’t find that it’s a F2F issue. On Schwab and at finra, it just states it is a fixed issue. Where can I look to verify that it floats on 1/15/26? Thanks

              1. Whidbey – I found it by googling “southern 2051 FWP.”
                https://www.sec.gov/Archives/edgar/data/92122/000009212221000043/southern2021ajsnfwp.htm

                Jerry – I hesitate to even say this as you know the market very well, and I appreciate your posts. the Cusip I listed is the capital security which is trading about 40 bps (yield) cheaper than the sub debt, I know the sub debt has been mentioned here a few times. I have owned the sub debt for a while, just picked up the capital security for the first time yesterday. The capital security ranks junior.

                1. Thanx, Maine…my hole in strike zone tends to be credit vs structure. Love the color you & others provide! Best

  14. Here is a 2WhiteRoses Special – earn a ~5.75% (guess), with a qualified div, for (approximately) a year, then it will likely get called. Actually, a true special would be a guaranteed maturity, but gotta take what I can get.

    Offered at $99.35 on IBKR now

    Truist $1,000 Par – Series P Fixed Rate Reset Non-Cumulative Perpetual Preferred Stock, 4.950% until 12/1/2025, then 5Y Treasury + 4.605%

    BBB- Rating: https://ir.truist.com/credit-ratings

    Prospectus: https://www.sec.gov/Archives/edgar/data/92230/000119312520154313/d893550d424b5.htm

    1. Makes sense, Maine……… I’ve just been so out of touch recently, though, that mentally I don’t think I’ve adjusted to what yields are attractive these days… to do this for 5.75% ytc just doesn’t seem to be enough but again, that’s probably me being off base….. I’ve literally done nothing for weeks, not even rolled over CDs or Treasuries, not by design as much as being busy handling other things… but wait! there was one exception – yes a typical 2wr special – i bot TELZ upon notification of call… and even on that, had I been paying closer attention to this site, the opportunity was there, thanks to early posting by someone, to have bot much cheaper that morning premarket.

  15. Treasuries have been falling seemingly every day since the last auction, where (from memory) 75+% of the auction was taken by indirects (“ferners”)
    seems like yields always rise after an auction where indirects are a huge piece.
    4.173 on the ten with 4.55 on the 19 year being the high yield.

    Top ticking with this post , most likely, but those preferreds have to have
    better entry points

  16. SJIJ: The tender for the junior sub debt looks like a YTM in the low 8’s.
    You can buy the SJIJ 5.02’s of ’31 at 84.384 for a YTM of 8.17.
    Cusip 838518aa6
    I do not own any. There’s 5 mill on offer .

    1. LT – I added to my stash on Wednesday, picked up 15 at $82.68. My only regret is that I had to purchase it in a taxable account.

      Regarding the risk of rates rising, I have plenty of floaters and resets. Also, I’ve been around the block w some of the smartest FI and macro managers, and rate timing is generally a low alpha trade, usually negative.

  17. Found this on Vanguard… JP Chase new issue bond cusip 48130CTP0 coupon of 5% with maturity on 4/29 2033…1st call on 10/31/2026…pays yearly.
    My long dated ladder is full…thought this might be of interest.

    1. Maine-
      Aren’t those CLO CEFs in the dumpster with you? Most debt doesn’t default. Good luck!

      1. R2S Maine is looking higher up in debt stack. Not sure if something goes sideways you will still be covered. These higher risk plays with REIT’s make me nervous. The strike with is it the SAG union? Actors who do green screen and wear motion sensors for characters in video games are worried they will be replaced by AI
        Anything to do with rental property to businesses associated with the video and movie industry. They were affected with the guild actors strike.
        Same with businesses associated with supporting Boeing and all the community businesses around the neighborhood where the Boeing factories are located. Makes me wonder what would happen to the property owners if the businesses renting in industrial parks, strip malls etc went under because striking workers are not spending or Boeing cuts back

        1. Hey Charles! I think you know more about the situation than me, just hoping for “survival” from this piglet. Joking aside, I do see some positive trends for office in general, and am willing to risk some $.. the position is less than 1%.

          BTW, have you noticed Hpp-c? It’s up to $15, or 8% current yield! It’s also a $425m issue, a decent amount of cushion if things go bad.

          1. Hey Maine, Here are a couple if you can do like Azure or Losing trader and find a way to buy a 144a
            024747AF4, or 024747AG2,

            1. Thanks, Charles. Always looking for new FI ideas.

              BTW, I did buy some of the Goldman Series Y 1,000 pref issue yesterday near par. 6.125% fixed to reset. Resets 240 basis points off the 10 year, in 10 years. Not bad for qualified.

              1. @Maine I too would like the CUSIP on the Goldman Ser Y Pref with 6.125% coupon floater

  18. New Fortress Energy. Redemption of my 2025 bonds with new restructure. Grateful as I probably had too much in this bond. Accumulating since issue. I did have a strategy based upon financials but luck always plays a part.
    Will look at remaining bonds later after the dust settles.

  19. 2WR,

    I use Fidelity software and site for information about bonds just because the software is much easier for me to finagle. I also learned today that I was misinterpreting the coupon listing for a floating rate note like this PPL bond. The rate that Fidelity is quoting in their overview page of the bond lists the coupon rate of the last payment, but not the “current rate”, which can be quickly calculated using the forward CME SOFR that has been recently cited on this site?

    1. I’ve often thought that there should be a place in this world where a website aggregates F/F rate issues and keeps track of and publishes the new rates for each issue the day after the new rate is calculable… Nobody does that it seems and no issuer seems to think it’s important enough for their IR Dept to put out the number immediately…. Tex, you listening??? Maybe you could use Excel to create such a site and call it floatersRus.com or something?

  20. I am surprised and wondering.

    I own this bond (thanks to Dick Whtiman):

    69352PAC7 – PPL – floats off the 3 month plus 2.66%

    It’s time for the floating rate to reset (September 30 in the prospectus) and I recently received notice from the company through my broker (IBKR) statement:

    ….PPL Float 03/30/67 announced a coupon payment, effective 20240927. The declared rate on the coupon payment will be USD 0.02157.
    ISIN: US69352PAC77….

    This actually calculates out to a rate of 8.63%, which surprises me that it is that high. I have access to the prospectus, but I have not found the details about how the change from LIBOR to SOFR is handled.

    any comments or assistance would be appreciated.

    1. It is now SOFR+266+26. Coupon does seem high unless the determination date was more than a few weeks ago.

      I own it too.

      1. landlord,

        It’s odd. almost like it a three month SOFR backwards calculation…

        I still cannot find PPL’s statement about LIBOR to SOFR on its website or at the SEC… of course, it’s always possible that the note I got at IBKR is incorrect….

      2. If the rate is 8.63%, then they must be announcing the rate to be paid on 9/30 which was set on or about June 28.

        1. Thanks to all ..2WR ..Mr Whitman.. ..landlord

          2Wr explains it. It’s not been a good day for thinking for me. I made the assumption that the notice I got from IBKR Was the declaration for the calculation for the next three months, but it was the declaration for the payment for the past three months…

          funny, I was texting someone today and they made light of my lack of ever assuming anything (a not uncommon statement to me) which made me think of the old slogan -“assume” makes an ass out of u and me…

          1. By extension, you now know as of today (or maybe yesterday) you can calculate the rate for the 12/30 coupon, right?

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