Common Stock Chat

This page is set up for those that want to chat about various common stocks.

There are no rules–other than the usual–no politics.

844 thoughts on “Common Stock Chat”

  1. Sinclair Broadcasting Group (SBGI) jumped up almost 18% today on news that Amazon has reached a deal with Diamond Sports Group which Sinclair had been in a legal tussle with. Good news for regional sports television and good news for SBGI shareholders. I sold 25% of my position on the news to maintain balance in the portfolio. If there’s a short squeeze going into Friday’s option expiration I’ll probably sell another 25% or so. Proceeds are going into short term t-bills until something better comes along.

  2. XOM , or other energy issues, with the Mid East problem moving higher ( recent DIRECT Iran strikes on nearbys ) and Oil currently in low $70’s …. could Issues like XOM (Wed am arnd $97.50 ish and 3.90% Divi rate) prove defensive .

  3. For those here looking for oil/gas cash flow income, you may want to do some deep due diligence on (KRP) Kimbell Royalty Partners, LP. Kimbell’s equity/stock is on a nice dip, has outstanding cash flow, is 100% domestic production (no Red Sea or Strait of Hormuz), with a whopping 17 million gross acres with more than 127,000 wells, is a 1099 reporter NO K1, conservative business/management with a history of excellence, 71+% of last years distribution income was NOT taxed etc etc etc.
    FULL DISCLOSURE: I am extremely long (KRP) for many years (and bought more this AM) and have generally reinvested the vast majority of my dividends. I am friends with some of the management people and Board of Directors; this may influence my decision to own such a large position in this energy equity.
    I urge each of you to NOT rely on someone behind an iPad (like me) that may or may not have your best interests in mind and do your OWN diligence before committing one cent to any investment https://kimbellrp.com/
    The only thing that hurts more than paying an income tax is not having to pay an income tax. I am Azure

    1. thanx AB, I believe Charles follows it as do I and I have owned KRP in the last year, the wild trader I have become. I have it on hotlist.
      I have been building Whitecap as disclosed in Trapping Value’s SA article (in my Roth no w/holding on the Canadian divs w FIDO.) Bea

      1. shhh Bea,
        I didn’t know AB held this honest.
        No K1, as a trust they are one of the few who add to their acreage. Most trusts are stuck with original acreage and declining assets. Increase their line of credit with a consortium of banks in Sept. probably on the hunt for a purchase. If they were smart, they should start accumulating mid stream assets.
        Disclosure, I hold in 3 accounts.

    2. AB – do you have any insight as to how their tax reporting/ROC works? I know they issue a 1099 (not K-1), but they say 55% is tax free reduction in basis (ROC?).
      I am curious how the ROC is handled (esp when you sell).
      Does it get swept up into the 1099Div?

      Example (rounded for simplicity):
      I buy 100 shares @ $15
      Hold for two years, receive about $360 in payments, of which about $200 is ROC.
      Each year, I get a 1099div for the $180 (and presumably some statement that $100 is not taxable?)
      Sell the shares At $15.

      So, brokerage sees a zero profit transaction.

      What goes on final 1099div? does it show “recapture” (or similar) for the $200 ROC?

      Apologies for the technical question – I haven’t owned a 1099 reporting MLP before and I am having a hard time conceptualizing how the tax treatment works.

      1. From my experience (but not this particular equity), nothing goes in 1099 for ROC, it just reduces your share cost accordingly. No tax implication until you sell the shares and broker reports (a larger) gain in 1099B. In your example, share cost would be less than $15, which your brokerage reduces and keeps track as reported to them.

      2. ROC works the same as for any other C corp. The 1099-DIV breaks down the dividend and non-dividend (ROC) parts of the distribution. The brokerage adjusts your basis down using the ROC part each year. Your 1099-B for the year of sale shows the adjusted basis ($11 in your example).

    3. I bought some this week after the BoA downgrade and Keybank price target cut. Seems like the selling is overdone, but who knows?

      1. RMH, lot of moving parts on this stock. Remember, payout is based on last quarter earnings, which oil averaged above 70 last 3 months (approx $72.00 on the futures market?) down from 3rd qtr. when oil was above 80 on the futures mkt. third qtr payout was .51 a share so going to be lower for the last 3 months. That is why I assume BoA and Key bank have lowered the upper end of the target price. Now this isn’t actually what they get per barrel. They collect price at the well head. I just use futures pricing as a rough gauge. There are other adjustments that go into estimating the stock price.
        Hard to say what the market for oil will look like in the spring. But this is one of the times where backward looking at the market can help you judge pricing in the future.
        I may add or sell this holding at any point in the future. DYODD

        1. Thanks Charles. At the current price, I figure even 40 cents per quarter would be an 11% distribution rate. And it just seems like the market is ignoring further potential issues in the Middle East and the impact to oil prices. But I’m no expert for sure, so will keep an eye on the situation.

              1. Red dog they did a private placement of the preferred. I don’t understand it completely. The company could hold it, they just did a purchase (merger) to get another company’s property or their leases and paid them in stock. The company that they borrowed from could be paid in preferred stock. Most of the time in these cases the preferred doesn’t get traded on the open market.

    4. I’ve owned it for a few years, The best thing I like about it is that it issues a 1099 instead of a K-1. Easier to deal with a decent return.

    5. Blue
      You might want to look at DMLP which has had very strong returns. Natgas is an important part of revenue and should prices decline, then it could be hurt but in terms of payouts and total return, it has done well. Merely a suggestion for your consideration. SC

      1. Thank you for your suggestion sc4, I was long DMLP many years ago, but may have sold the MLP because they have a K1. I promised my team of accountants that I would NEVER buy another security with a K1 unless I sat on the board of directors 😘
        The best deal for a US citizen is to move to Puerto Rico and take advantage of their 20 year tax package

        1. AB
          Yours suggestion noted but so far my accountant has not complained about the K-ls and the income and appreciation on dmlp has been good so for now I’ll stick with it. As for PR, sounds nice but I’m more likely to spend more time in Taiwan. Other than the summer heat and property prices, an attractive place to live for seniors. In all events all the best for the new year sc

  4. SAR – down 8% today on earnings miss and concerns about overall debt levels when including SBA debt…… I own small amounts of SAT and SAJ.

    1. Thanks 2WR’s I have to check but I think I own SAJ in one account. Where did you read this?

      1. Help 2WR, I tried doing an internet search, but it came up empty. Do you know what the abbreviation NREM means in regards to bonds?

          1. This is on Fido’s bond page. You know how they show sold dealer to dealer, customer buy or sale or third party market (sp) ? it’s an seems to be an abbreviation for where the sale occurred?

            1. NREM {If you look under “Trade Attributes]
              No remuneration (NREM) – For corporate and agency bond transactions reported to the FINRA Trade Reporting and Compliance Engine (TRACE), this indicator identifies that a commission or mark-up/mark-down was not assessed on that trade. A firm may report a transaction to TRACE with this indicator either because the firm does not charge or does not know the amount of the commission or mark-up/mark-down at the time of TRACE reporting. For example, some firms may assess a charge that is not transaction-based, such as in the case of a “fee-based account” or “wrap fee” arrangement where remuneration is based upon assets under management (and individual commissions or mark-ups/mark-downs are not charged).

              1. 2WR I knew you had the answer !
                I’m afraid I don’t fall in that one category where my assets under management are impressive enough to get special treatment. But it doesn’t hurt to ask.

  5. BankAmerica looks like another casualty of the LIBOR crisis. BoA substituted a new short index when it looked like Libor was being phased out; That index is now being phased out, So BoA is taking a 1.6 billion “non-cash” charge.

    Bank of America to take $1.6 billion noncash charge as it transitions away from BSBY index for lending
    https://www.marketwatch.com/story/bank-of-america-to-take-1-6-billion-noncash-charge-as-it-transitions-away-from-bsby-index-for-lending-bb8e858b?mod=mw_latestnews

    JMO. DYODD.

  6. Someone is dumping KRP today. Double the volume. Unless they know something I don’t since oil has been pretty steady the last couple months the payout should be close to the last one. This does not have a K-1 even though it’s a partnership
    35 days to the next ex dividend date. Hard to say what the market does in that time.

    1. The upgrade of ALL does not appear to have affected ALL-B at all. Up by only $0.02 at this time, I hold a very small number of shares still underwater by about 15 cents

      1. I didn’t mean to imply that I thought the upgrade would make a material difference in the price of ALL-B – it shouldn’t…. But it’s always nice to know an analyst thinks the underlying company is stronger, not weaker, than it’s perceived….. Then again, I suppose it could be argued, the stronger ALL, the company, is the more likely a call of ALL-B could be so who knows…

  7. The money manager discussion here circa 11/10/23 prompted this question.

    I’ve managed my investments for 40+ years. A few years ago I met with half a dozen or so “money managers” in my area and other than one, they left an awful lot to be desired. The ‘one’ had a good head on his shoulders but he was young and lacked experience. So as far as I was was concerned, that direction was a dead end.

    I opened a Trust about 30 years ago with my lawyer (long term relationship) as my Successor Trustee. Unfortunately, he is 80+, has phased out his practice, and he has lost a step. I don’t think much of the other lawyers in the practice and my lawyer doesn’t have any suggestions beyond that. Since I’m long retired, I no longer have any contacts. My family isn’t doesn’t have the financial IQ necessary to manage the trust’s finances so I’m contemplating using the trust department of a local bank.

    I’ve looked at the fees for a few locally. But beyond that, I haven’t a clue. I’d appreciate it if anyone who has gone this route can provide any information as to what to look for and how to go about this. I need to know a lot more in order to make an informed decision. Thanks.

    1. One suggestion – you might ask your attorney if he knows a local professional fiduciary.
      Depending on the state you are in, they are the folks courts often appoint to step in and administer a trust when the trustees are not competent. I know a couple in my area and they are great guys. I would trust them more than any bank’s trust dept. my experience with trust dept.s is that they are only marginally competent (usually inexperienced people who are following a script without any thought) and very expensive.

      One other thought – you can separate administering the trust from managing the finances. You can find a fiduciary wealth manager to handle the money (might be easier) and someone else to administer the trust.

      1. Who oversees the professional fiduciary if I’m non compos mentis? What prevents them from churning the accounts or selecting high commissions securities?

        What’s the difference between administering the trust and managing the finances? I’m not sure what administration is involved unless I’m on a tube or dead. On a tube is more of a concern because if dead, the estate gets distributed.

        Is there a difference between a fiduciary wealth manager and your aforementioned court appointed type of appointee. Or are they one and the same.

        Thanks for the feedback.

        1. It all comes down to ‘you have to trust somebody.’
          Here’s what I did:
          1. Found a 1st rate estate law firm to set up the trust.
          2. Follow-on trustees cannot disburse funds. A professional bonded firm will do that and ensure the expenditures are proper, i.e., they won’t be paying for any world cruises for whoever the trustee is at any given time.
          3. Firm in #1 oversees what follow-on trustees do and can replace them if needed.
          4. First two follow-on trustees (they’re also follow-on beneficiaries) can buy & sell securities, but I have left specific instructions and have pared down assets to those that should pay forever and that are difficult to sell or that have huge negative tax consequences if sold.
          5. I am the last original beneficiary and nobody gets anything until I’m gone.
          6. I have to trust that my precautions and incentives are in order.
          7. It’s a very big deal, the culmination of your life. Good luck.

          JMO

          1. Camroc, thank you for your post. There really are 6 components of an estate plan:
            Will/Trust
            Durable Power of Attorney
            Beneficiary Designation(s)
            Letter of Intent
            Healthcare Power of Attorney
            Guardianship Designations (if you have minor children)
            Also, one of the most important discussions is to make sure your estate goes ONLY through to bloodline (a separate form here in Florida). This means that if you leave your estate to your child/children and if/when their spouse divorces them no money from your estate will go to the non-bloodline spouse.
            When I was in law school, one of my favorite professors use to say that the estate area of the law was the most litigious and destroyed more relationships than anything else we would encounter.
            Wishing you all the very best, A

            1. Yes, all that. Best to use specialist pros so that everything meets the often arcane requirements of whatever state you’re living in. Texas, in my case.

              Ours was set up in 2017 and so far it’s all worked out smoothly as planned.

              It’s never too early to get your affairs in order. Otherwise, terrible things and irreparable family splits can occur. I’ve seen it happen more than once to people dear to me. Very sad. I wouldn’t wish it on anyone. So best of luck to all.

              JMO

  8. Ken Fisher, opportunistic about 2024, had an interesting article about 2024. Large growth stocks doing well in 2024 and value stock doing well later in the year. Google “Ken Fisher NY Post”.
    One quote: “Our economy? Moderate growth will help finish inflation’s normalization (increased supply from growth is anti-inflationary, not inflationary as economists imagine) and helps growth stocks relative to value, like in 2023. But later year rate cuts likely usher in value stock leadership.

    Value stocks thrive from the accelerating bank lending that rate cuts render. They need bank lending to fund expansion initiatives. That comes as rate cuts steepen the so-called “yield curve.” Banks borrow short-term to fund the longer-term loans that let mundane firms grow. ”
    Happy New Year if it happens and no black swans.

  9. Bot some NWN 12/29, NG/water ute; they have been a steady accumulator of little water systems to go w mostly Portland OR ng supplier, also a renewable natural gas project etc. https://s23.q4cdn.com/611156738/files/doc_presentations/2023/Jun/06/june-2023-ir-presentation_final.pdf
    Like some other recent buys for me this 5% div (grown 67yrs but really by only a penny or so a yr) diversifies some from some ‘safe’ cash. The market is growing about 1.1% yr for new residential ng adds but the ‘exciting’ part is the water build, which diversifies revenue and water co’s traditionally command higher p/e’s. Smallish so outside chance could be bought out by a bigger ute but not a reason to own. Enbridge of course just bot a huge portfolio from Dominion in utes; No debt refi in ’24 and only 30mil due in ’25. Utes under pressure of course w rates up but if ZIRP is over and ‘normalcy’ returns they will also be able to ask for higher ROE’s in rate requests. May be able to juice div returns w out of the money options, although they are thinly traded. DYODD Bea

      1. yes E, it is B..lol. Been following Tim’s sites forever, now where he runs III, which is a great place to chat with respect and no politics w people who know a lot about income ideas.

        Not sure the NWN yield is enough for you -but this is a top quality company- and with well over 50% in cash now I am happy to lock in a 5% yield on it for a starter position and may add. If we see CD/short term Treasuries trend down into the low 4’s this year, some of the better utes
        should do well.
        ( I am also going to wade into CHSCL a popular pfd here )..Happy New Year, Eileen, bests to you. Bea

        1. Bea, good pick with NWN. Picked up some of that in late November along with BKH & UGI. Held both of those for a long time but sold them last New Years timeframe. Glad to be able to pick them back up. Utilities, in my opinion, solid way to go with all the CD redeems hitting the market throughout 2024.

          1. Pig, the Black Hills has a bond paying 4.93% 092113AM1 but your not getting the growth in price like the common.

      2. ED, you have to follow Bea on SA.When she gets in a saucey mood, her anecdotes can be hilarious, though they may fly over some smaller cranial readers though.
        Bea, you have any 2024 yield projections? You seem to be accepting lower now.

        1. A second welcome to III, Eileen. Good to see you here…. You’ll find a whole different atmosphere over here and I think you’ll enjoy it..

          1. 2WR want to pay you and Grid a compliment. They announced on the radio yesterday that money managers have been attempting to use Chat AI to read SEC financials.
            The response was AI isn’t replacing a human just yet. After scanning thousands of reports ChatGPT wasn’t able to respond to the simplest questions asked about the filings correctly, or made up answers or was silent and wouldn’t respond. This is not stopping financial companies like GS who are working on their own AI programs. Just think, if its hard to read them now and interpret them think about when AI will be writing them.

            1. Thanks, Charles… as an aside, I DJ for a small private music group where I put together songs centered around an eclectic theme I make up…. In my first post of ’24 I am figuring on mentioning how ChatGPT and AI might possibly be taking over my job this year, but before it does, I’ll be invoking the use of an older technology for my first theme of the new year – I’ll be using UDARL technology, aka, Unmitigated Dumb Ass Random Luck to feature the first few songs my MP3 player plays for me in 2024 when it’s set on random play . That should be an eclectic enough theme…… Sometimes I can’t help but think that invoking UDARL technology more frequently in my investment choices this year might very well aid in my portfolio’s overall performance as well….

        2. Gridboo, Bea is seeing ‘slightly’ lower rates in 2024, modeling on 4% ish short term.. Eileen tolerates me..she won’t put up with nonsense either!

          Seeking Alpha is not Eli Hoffman’s SA, it is a cesspool and I play Rid-X in the septic tank on occasion..as do you, 2WR and others.. boredom mostly fueled occasionally by caffeine waiting for poor old mom to get up or need me, my only concern in this world. If Avi Gilburt doesnt get me banned.. wave man..lol. 20yrs of financial social media maybe my NY resolution should be alt/control/delete/avoid. They pushed all the good writers to ‘services’ and then just whacked the heck out of their comp..nutz.

          Piggy, yes I see value in utes, might go w SR on a swoon, NWN is my first foray into the space other than BUI the cef w a basis of 19. I think Eileen is in or was looking at UGI.. thanx for ideas forgot about Black Hills BKH another good one. When you look at the charts there are a lot of ‘double bottom’ formations in ute names. Put those on watchlist, thanx again, appreciated! B

          1. Bea, yes, I kept poking end of world fear monger Avi trying to peddle to sub sites for even more moolah about all my CDs are in extreme peril. He finally gave up. But reset assured every time I get my CD interest payments I am going to poke him.
            I see the short end dropping too. But I am a bit concerned the long end has front run a lot of it, so I in past day or so dialed back a lot of the quick captured gains.

        3. Grid, Eileen is part of the hole in the wall gang over there on SA. Very knowledgeable on Preferred stocks. Don’t think she has Bea’s walk on the wild side when it comes to things like gold stocks but she does get into mreit’s.
          When I see ED’s comments on an article tells me I’m on the right track.

          1. Grid and Bea no one has a crystal ball on future rates. I would like to see them right where they are now, but I agree with the discussions on this board that I could see them higher later next year. Also the talk about the drop in price of bonds. Example, I was looking at the FSK’s bonds going from about 8% yield in Oct. to 6-1/2% now. The FED hasn’t even cut rates yet but rates are going down. I guess because buyers of debt are willing to pay more to lock in what they think are great returns at 6-1/2% on higher risk investments?
            I understand ED’s recent comment she was still hoping to get 8% on a buy.
            I’m still feeling I should be getting better deals than what I am seeing now.

    1. AB – Thanks for the article…. With SPACs having earned such a bad reputation one wonders when you come across people like Phil Goldstein of Bulldog Investors (SPE and PCF), Boaz Weinstein of Saba Capital Management (BRW and CEFS), and CrossingBridge Funds which runs The CrossingBridge Pre-Merger SPAC ETF (SPC) who not only go out of their way to get involved in SPACs but in some cases are seeking shareholder approval to even increase their involvement…. But what they are doing is taking advantage of the pre-market arb opportunity to generate stable income using SPAC vehicles prior to the SPAC finding a target company.. In fact there’s one idiot, oops! I mean author, on that other site who has written 5 separate articles about PCF and their use of SPACs who has never bothered to figure out why they use them

      I think CrossingBridge has a good writeup on their strategy for SPC – you’re not going to hit any homeruns buying SPC, but so far it’s been a decent parking place for cash – https://www.crossingbridgefunds.com/spac-etf. NOTE that SPC just went x-div for a 71 cent dividend. to be paid on Friday.

      “SPACs provide shareholder-friendly features that present an arbitrage opportunity for SPAC common stock shareholders. Given that SPAC shareholders have a full redemption right to their pro rata share of the collateral trust account that is typically invested in U.S. government securities, the downside risks of pre-merger SPACs are significantly limited while also presenting the shareholders with potential equity upside.

      The strategy focuses on purchasing shares of common stock and units of SPACs that are trading at or below their pro rata share of the collateral trust account (i.e. trading at par value or at a discount), with the intent of disposing of the shares prior to, or at the time of, a business combination. We look at ourselves at ‘renters’ of SPACs, not owners. In other words, we aim to capture the fixed income nature of pre-merger SPACs, along with the equity upside that they present, but we have no interest in being an equity investor post-business combination, which presents a much different risk/return profile akin to a traditional equity investment.”

      1. 2WR, the “idiot” you reference just has such a poor track record and I’m just unsure as to why he keeps pushing this CEF. A look at closed end fund PCF: 1 year total return (in an incredible bull market for practically EVER investment) is a “whopping”: +2.69% 😱, 3 year average total return just +2.31% and 5 year average total return +2.66! The only one really making money on this horrible investment is the PCF management team (who should be replaced with more competent people). Also, over 50%+ of the PCF portfolio of investments are unrated.
        Bernard Baruch said, “I have found that failure is a far better teacher than success.” Well, the management team and the “idiot” you have referenced should have doctorates in failure by now 🙃

        1. I do own PCF and it has been a disappointment overall relatively speaking. However, what I think I have found is it has been more of a proxy for interest rates in general than I had bargained for. If it continues as a rate proxy, then perhaps future performance may improve, however I am certainly not recommending it but am also too stubborn to sell as of yet.

          If nothing else, this exercise does bring up how it does not seem to always be as straight forward easy to measure performance as I would think. As it stands right now. the value of my PCF shares is practically dead on equal to what it was at year end 2022 (it’s actually slightly higher because I did reinvest for the first 2 months of the year). I do not reinvest dividends and PCF’s managed distribution sets the dividend to be 10% of year-end NAV (not share price) which is what I have received monthly and still have Dec’s dividend yet to go. So if my asset value has remained essentiallly flat over the 12 months and I have taken out 10% in received cash over the course of the year, how can my one year return only be 2.69%? Actually with share price being dramatically discounted to NAV, actual div/share exceeds 10% for the year so I should have total return over 10% shouldn’t I? And in fact, my tracking software says I’m up over 12% for the year. Am I being naive?

            1. AB – I’m surprised you would rely in cefconnect for data…… I’ve found them to be frequently incorrect or out of date on data they post so I do not consider them reliable… For example, they’re still showing the Putnam Fund people as the managers of PCF and they haven’t been managing PCF since early 2019. I use them anyway, but only as a starting point that requires external verification if I want to feel confident with their data… That’s not to say they’re wrong on PCF specifically, but I do know the amount of cash in dividends I have received from the fund this year in and the present day value of my holdings and it just does not jibe with what’s being shown…. Still, as mentioned, I agree there’s nothing to write home about regarding PCF’s performance overall and not recommending. I’ll spend a little more time trying to figure out why the disparities – maybe I’m just not viewing what I know correctly.

              1. Just taking a closer look, I seem to be +9.787% (maybe slightly less) on PCF ytd figured this way:

                My year-end ’22 share price was 6.50. It is now $6.40. I backed out the value of the shares purchased with Jan and Feb DRIP and added it back as cash dividend received instead so as to equate the number of shares I had then to the number I have now. Then multiplying the cash received monthly for 12 months, I come up with the total cash received then divided that by my end of year ’22 share price amount after deducting the share price decline of approx 1.5% as of today. So that equated to a dividend received equivalent to 9.787% on my year end ’22 valuation. This will be a slight overstatement since the dollar amount received monthly is based on the slightly higher number of shares actually owned vs 12/31/22, but there’s no way that overstatement could be the cause of the difference in actual performance I think I had vs what cefconnect is saying. Interesting….. Maybe the difference has to do with my ignoring the amount of dividend attributable to ROC?

            2. AB – Now I’m even more confused… clicking “All” now in the top left area and then scrolling down toward the bottom looking for total return, I’m seeing numbers that pretty much compare with what I was saying.. It says Total Return on NAV (12 months thru 12/27) = +7.68%, There’s no Total Return based on share price, but given it’s traded at a substantial discount of better than 10% to NAV all year, I think my estimate of 9.78% total return has got to be pretty close, yes? Still not great but no 2.68% either….. And the ironic thing about performance is that based on the continuing large discount to NAV, PCF should be a candidate for activism by the likes of the activists who manage it!

              1. 2WR, no idea just where you are looking but “total return” (toward the bottom of the page look at the bar chart for price) 1 year is +2.69%, 3 year average +2.31%, 5 year +2.66% that is the total return as of 11/30; they only calculate the graph at the end of each month 🙃 BTW, I AM an activist (not to be disclosed here), but this is certainly not a candidate and I doubt anyone will care about this fund; there are just too many other interesting and lucrative targets out in investment land (not being rude just honest) that is a true activist. Smile, A

                1. I’m looking under Distributions (highlighted in color), then to the right of the second set of Data down called Distribution History. There is the Key Information Regarding Distributions sector. HOWEVER, I do now see where we’re talking about different measures as your area says the same as what I was pointing out regarding 1 year total returns on share price. I was focusing on 1 year total return on NAV and that percentage is also confirmed in your area. To be honest, I still don’t understand how there can be that much lower difference when based on share price vs NAV price but I guess that’s on me…

                  My only point about PCF being an activist target was not really that they are such a great target, but that it seemingly has all the characteristics in place such as a persistent fat discount to NAV, that its manager, Bulldog Investors, goes after as targets of their own activist strategy.

                  No rudeness perceived.. We’re also in agreement that this has not been an investment to write home about.

                  1. 2WR, NAV is what gives the daily share price in open end funds (mutual funds), but in closed end funds NAV is not as important because these funds trade at premiums or discounts. If you look at (CEF) closed end fund FXBY this has a whopping -45.81% discount to NAV https://www.cefconnect.com/fund/FXBY?view=fund
                    It’s really why I said I doubt any activist would be interested in tackling PCF; there are just too many others to be interested in if one was inclined to go after management of a CEF.
                    Lastly, if you look at just matured CEF symbol IHIT, this was a complete disaster. A bond fund that lost money for their investors in each market, a promise of a maturity date to liquidate much higher than was originally given/promised with incompetent management and I’m surprised the securities attorneys haven’t tried forming a class even after maturity to recover losses.
                    Sorry again for being so winded my friend.
                    Be well and happy New Year to you and your family. I’m leaving today to ski in Telluride, Colorado and hope to comeback in one piece after the New Year 🇺🇸

                    1. I did experience the IHIT disaster…… I thought I understood why it happened to some degree and that was because they were estimating maturities to match up with their term target date on a lot of the mortgage backed securities in the portfolio based on expected prepayments as they were expected to occur in ZIRP and did not adjust the portfolio accordingly when rates rose dramatically. However, beside that, the managers intentionally hid the facts on top of that and were fired because of their deceit. But that didn’t save the shareholders from disaster… that was evident when NAV dropped precipitously near the end when they were supposedly already 95% in cash. I agree with you – there sure seemed to be reasons for a class action due to purposeful deceit.

                      Have a great trip in the rarified air of Telluride and Happy New Year…… I don’t think I could breathe up there! Colorado Springs is about my limit.

                    2. I think closed end funds are a different and more complex animal. It is not as simple as saying Nav is not as important. I believe when analyzing CEFs, ALL the metrics are important. Otherwise, it will be like flying a plane and having the pilot tell the copilot to not pay attention to the instruments on the right side of the cockpit. If a cef has a great payout %, price goes up, big discount to NAV, but a continually eroding nav? There is nothing like owning an investment where the managers are happy, and the destruction of capital for investors. There is a lot of fear in CEFs because of that. In the end if you are not looking at all the metrics for CEFs, you might get caught with your pants down, but at least you are still holding your prize belt in your hands.

      2. There was a nice period recently (late 2021 I want to say?) when there was a flood of supply of pre-merger SPACs and you could find YTMs–or maybe the better way to say it would be “yield till redemption”–over 8.00%, which was very strong at that point in the cycle.

        Since then a ton of SPACs hit their deadlines, supply is way, way down, and yields are too. Hardly seems worth the effort anymore.

      3. “we aim to capture the fixed income nature of pre-merger SPACs, along with the equity upside that they present, but we have no interest in being an equity investor post-business combination,”

        To put in layman’s terms:
        Would not invest in SPAC under a fund like structure but the private equity people loved the idea due to the following.

        In pre-SPAC phase when you accumulate units a bonus warrant (long term options contract) is tossed off. If no acquisition, ho-hum burn warrants in the fire while receiving original capital back. If a combination is announced we dump our shares into the excited new IPO crowd keeping the warrants.

        As the second holders continue the pump to find their exit liquidity we finally unload all our warrants. The warrants are the nuclear juice for the original holder where all the return takes place.

  10. In my mad max bucket for common stocks. My loss on these cigarette butts could be your gain. All financial names and plan on holding out for another year.

    OTCPK:WTBFB W.T.B. Financial Corp
    Family owned bank. ~6B deposits they should up list. Use them as a perpetual 3% CD.

    OTCQX:BNCC BNCCORP
    Activists firmly in control of the board. Clean up job nearly complete. Next catalyst is for regulators to sign off on capital control to start return of capital to investors.

    NasdaqGS:PROV (Provident Financial Holdings Inc)
    Valued at 65% of tangible book value. Down 14% on the year which I suspect is due to tax loss harvesters. Deposit base cost of 0.65% even if I am off on this account they should be taken out by a competitor on these metrics alone.

    NasdaqCM:RBKB (Rhinebeck Bancorp Inc)
    Stated tangible book value setting aside the MHC is $9.41. A fools would perform a take out offer at $13.00. @18% 1yr arb is worth the wait.

  11. Every year I dump my looser and re-invest hoping to turn a tidy profit. On January 2nd here are my selections.

    American Water Works (AWK)
    Public water utility which has suffered a large market pull back this year.
    Backed by a 50-year contract to provide water and wastewater utility services at 18 military installations.

    Amphenol (APH)
    Makes electronic and fiber-optic connectors.

    Federal Agricultural Mortgage (AGM)
    No introductions needed chartered by Congress in 1988. 11 times 2024 estimated earnings. I am the Grinch that stole Christmas.

    McGrath RentCorp (MGRC)
    rents relocatable modular buildings, portable storage containers. imagine a construction site in the middle of nowhere or expansion classroom for the local school. A REIT in sheep’s clothing.

    Rollins (ROL)
    Got bugs.

    1. micahc, Interesting. I have been looking, but was trying to stick to common stock that are at least paying a 3% dividend so I can get a combination of growth and yield.

    2. I was just turned onto AGM earlier this year. Looking at them now is like looking at Amazon for me. It’s hard to buy at all time highs, but there never seems to be a low point.

    1. Ab I can’t find your post on here you did for gold stocks. Could you re-post. I was holding 3 in one account but bailed on 1 when it hit break even. The other 2 I am still underwater on.
      As for this link, I already own EIX preferred. I looked at CLX the last couple years and decided against it for reasons that brand names are under pressure with inflation and consumers willing to switch to generics because of prices.
      Was a loyal follower of Purina cat litter, loved the 35# reusable plastic pails but TGT clumping cat litter is 2/3rd the cost!

  12. Sadly, selling my stake in US Steel (X). Nothing but smiles owning this, perhaps I’m giving up a few bucks for a higher sale offer, but feel like 6X bagger is a good time to exit. Another Covid purchase and much beloved part of the pig pile portfolio.

    1. Awwwwwww, I feel for you, pig… It’s always a tough day when you have to lock in 6x your investment…. lol… I only got involved with X 2 months ago when, in a better to be lucky than smart move, I bot a US Steel 6.875% bond due 3/31/29 as a back door way to possibly play the X biding war game from a less risky viewpoint… It’s of course done well with the overall decrease in interest rates in the interim and apparently still does not reflect any possible impact which could come depending on who, if anybody, ends up buying X… The game’s over now because these are trading above par, but there is a convoluted change of control provision that could get to over 103 but it’s dependent on the credit quality of the acquirer. Essentially, the junkier the buyer, the better shot the call gets tripped off…. Trading now at 101-ish, it’s no longer anything other than callable B1/BB- bond in my eyes.. CUSIP 912909AU2

      1. 2WR,
        I do, I think, remember you mentioning that Bond.

        Kicking myself on the X sale a bit, should have done it last week as I want to take the proceeds and buy income with it. Better last week than this, oh well.

  13. Debating on buying PFE here. I still think there’s some room to fall into the first quarter of next year, but I don’t know what that bottom is. This feels like the regional bank sector from a few months ago. I tend to not buy my healthcare companies outside of an ETF because I don’t like/enjoy/understand trying to figure out the pipeline thing and who has what going for them.

    Pfizer feels too big to fail. They’re at 10 year lows which is also not something I want to see, but I have a very long horizon to hold this if necessary. Despite them raising the dividend today I don’t have full faith it doesn’t get cut. I still think I start a very small position today so it’s on my radar and I’m paying closer attention to it.

    1. Have you looked at net cash flow? I believe the current dividend costs them nearly $10B annually. If that divi gets cut, stock is heading much lower.

      But definitely at least a flip candidate for early January dog rally when the biggest losers of the previous year always get pops.

      1. That’s my biggest fear. I really don’t enjoy flipping or trading in and out of stocks. If I’m purchasing it’s usually to hold for a year or more. I will probably end up just staying on the side line with BME and BMEZ. I’ll be monitoring them though.

  14. OXY

    This past summer Buffet bought a ton of OXY at his favorite price point $56s-$58s and his stake was in the 25% range. The stock then rallied for months into the $60s.

    Now this past week, stock pulled back to $58s and Buffet bought another ten million shares. Might be worth checking out as he really seems to support the bid in this range historically.

  15. Must be Groundhog Day, the movie where the same day happens all over again. Another run at Macys. Another big oil company drilling on Wall Street. Another Paramount rumor. Another WFC story

    Just caught a headline that Wells Fargo WFC , along with some other banks, is caught up in another lending scandal. ( “Wells Fargo was snared in an industry-wide probe into mortgage bankers’ use of loan discounts last year, CNBC has learned.”) I did have to read the dateline to be sure it wasn’t an old WFC story. There are so many.

    Wells is among the largest home mortgage lenders, although – surprise, the biggest lenders these days are non-banks. In January Wells announced it was cutting back on lending, , restricting loans to bank clients and undeserved communities. (I can see a class action lawsuit coming down the road on this policy.)

    WFC common had the obligatory 10% one-month pop. It is up 9% on the year. Wells yields ~3%. Analyst sentiment is a hold, but leans strongly to bullish. Wells appears on the too big to fail lists. TBTF gives the Big Banks a competitive advantage over the regionals. They can scoop up cheap deposits,. Large corporate depositors have no worries of being over FDIC limits because of TBTFs almost-GSE stattus. I heard somebody pitch Chase as the only bank to buy in 2024 because any of proposed regulatory tightening will impact the smaller banks., raising their costs and driving more customers to the TBTFs. There is a logic to this.

    Wells common is not on my shopping list. I do look at the preferreds from time to time, JMO. DYODD.,

  16. Hedge fund sharks are circling Macy’s with a bid of $21 a share. In case you forgot Macy’s is an unpopular stock in an unpopular sector, retail. With a $5.8 billion price tag on a company that generated $1.2 billion of profit, the price seems too low, given Macy’s valuable real estate portfolio.

    The real estate alone is conservatively estimated at $6 to $8 billion, more than the market cap of the company. Macy’s and its real estate have attracted PE interest before. Starboard Value estimated the real estate at $21 billion in 2021. (“Our extensive research indicates that: Macy’s real estate is worth approximately $21 billion, and possibly far more. “) Starboard thought Macy”s was worth 3x the latest PE bid. https://www.valuewalk.com/starboard-value-macys-inc-m/

    We’ll see how this one plays out. PE reportedly controls a large chunk of Macy’s shares so we’ll see if they succeed in squeezing out the small shareholders with a low-ball bid. Some may remember how all that “worthless” Sears and K-Mart real estate suddenly went up in value after it changed hands,

    The story is in the WSJ. Long M. JMO. DYODD.

  17. GBLI – Global Indemnity. Off 15% as they had previously announced they were looking at a possible combination/merger with other companies and today they said they ended that search. Here are some relevant stats:

    – Share price: $28.75 (12/7 close)
    – Book value: ~$46
    – Dividend: ~3.4%
    – Business: Specialty commercial
    – History: Up and down, mostly down. They’ve had a lot of trouble with some lines which they’ve exited.
    – Organization: LLC – Can’t remember but you may get a K-1.
    – My take: It’s a value play and if they can have a “normal” year of claims they would make a lot of money. Also, they’ve been able to keep the duration short in the investment portfolio and are now deploying to a bit longer term and higher yielding bonds.

    1. Yes you get a K-1 from them, Looking to get back in where I was before a little lower than here.

  18. As a deviation from my Preferred holding, I picked up some shares of Closed End Fund DNP which is sitting at a multi year low at $8.62. The fund is mostly a portfolio of utility stocks and has paid a steady dividend of 0.065 cents/share since 1987. I’ve read speculative comments on other sites that the share price drop may be due to year end tax selling, out of favor utility stocks, and that the dividend may be tough to cover down the road. To my eyes, it has made it though a lot of up and down markets unscathed over the past 35+ years and was a gamble I was willing to pick up. Time will tell.

    1. Looking quickly it looks similar to UTG which has also never cut its dividend and focuses on utilities… I big difference however is that to date it looks as though 52% of DNP’s dividends for the year have come from return of capital…. NONE of UTGs divvy is from ROC, but a lot of it comes from a seemingly never-ending amount of long term cap gains…. you’d think they’d have to run out eventually……..

      1. UTG is one of my core holdings. It uses leverage (approximately 20%) and is down about 12% from it’s 52 week high. But, I expect the price to slowly rise with interest rate drops. Current price looks to be an attractive entry level. Agree with 2whiteroses about the dividends.

  19. Tobacco stocks are down today on the news that British American Tobacco BTI is writing down the value of some of its US brands by $31B. BTI has the biggest drop so far today, off about 9%. Altria Group MO, Philip Morris International PM and Imperial are also trading down. This is either A Great Buying Opportunity or Another Cause For Concern. BTI apparently does have other US brands not yet written down.

    Tobacco stocks, always controversial, are popular with income investors because of their high yield, from ~6% to ~9%. Bears and bears wonder if the companies can raise prices faster than consumption drops. Vaping is a recent concern.

    BTI YTD down 29%
    PM YTD down 10.5%
    MO YTD down 9.5%
    IMBBY YTD down 6%

    Disclosure: Small long position in tobacco. JMO. DYODD

    1. Bear… I gave up earlier this year and sold my positions in BTI and MO. At this point, I just lost conviction that they’d be able to offset volume declines indefinitely with price hikes. I do still hold, and have added to, PM as they’ve been focusing on smokeless product and they have been vocal about a smokeless future. Lower yield, higher valuation, but I think there’s less chance they go away.

  20. Something to read before you replay the “Bank Run” scene from the Jimmy Stewart’s Christmas classic, ” Its a Wonderful Life:” The FDIC’s November 29 Press Release. It brings the news that unrealized losses on securities held by the banks went up 22% Q2Q. Yup, up 22%, (A lot of low coupon paper out there. )

    There is text, but no alarming chart, in the Press Release, only a happy chart showing that bank income is doing nicely, thank you, down only 3.4%. (The bad news chart is buried deep in the FDIC’s lengthy banking report as Chart Number 7. To keep you on your software toes, the “chart” downloads as an Excel spreadsheet. I don’t think I could find it again. )

    Presumably the recent drop in rates and the Fed’s widely predicted 2024 rate cuts will help pull the banks out of the hole.

    “Unrealized losses on securities totaled $683.9 billion in the third quarter, up $125.5 billion (22.5 percent) from the prior quarter. Unrealized losses on held-to-maturity securities totaled $390.5 billion in the third quarter, while unrealized losses on available-for-sale securities totaled $293.5 billion.” – FDIC, Press Release, 11/29/23

    “Old man Potter will pay 50 cents on the dollar for every share you’ve got.”
    “Better to get half than nothin’.” – Depositors, “Its a Wonderful Life,” 1946

    “Old Jay Powell will pay 100 cents for every 50 of 30-yr 1.5% Treasuries you’ve got.”
    “Better to get double than half ” – Bankers, Bank Term Funding Program, 2023
    Disclosure: longer than I’d like to be in banks. JMO. DYODD,

      1. I am holding some of their baby bonds (F-D), just to get some diversity. Bought most about a month ago (about $2-3 less than current). still yielding over 7%.

    1. I spent 20+ years as a automotive executive. There are so many variables impacting profitability that I know enough to not touch any of the automotive OEM stocks.

      1. Ford is #3 in the list of stocks that have made my family the most money, behind only Apple and Microsoft. It’s all on when you buy.

        1. Yes. Duration is the key. So much effort into short term trades. Yet, the simple advice to buy good companies at a fair price and hold, makes multi-millions.
          The only “new” stock of significance that I own has been NVIDIA. Bought that in 2015. The others were purchased 1999-2003.
          These holdings are now in family legacy trust accounts, ensuring their security.
          I think one of the most important keys to investing is learning about deferred gratification. Once again, grateful to live in this country.

          1. Somewhat related I guess, this article tells me that sometimes it’s better to be lucky than smart but, never-the-less, as you have suggested, you have to be in it to win it: https://www.benzinga.com/general/23/12/36051788/wall-street-banker-pays-2-million-sight-unseen-for-coal-mine-then-discovers-its-filled-with-37-billi
            This is the guy from RAMACO Resources [METC}
            https://nypost.com/2023/11/09/business/a-2m-coal-mine-in-wyoming-could-be-worth-37b/

            Wall Street Banker Pays $2 Million Sight Unseen For Coal Mine Then Discovers It’s Filled With $37 Billion Worth Of Rare Earth Elements

  21. Short news item in Market Watch about Pacific Premier Banc PPBI “repositioning” its balance sheet by selling off ~$1.3 billion of low yielding securities, (coupons ~1.3%) at a loss of about ~$180 million. Sale is out of its marked for sale portfolio. Intent is to redeploy assets.

    So was this an odd time for PPBI to sell since interest rates have been dropping recently? Maybe not. It’s not a TBTF. Perhaps PPBI thinks Fed won’t renew its BTFP support program, which values underwater assets at par for borrowing purposes. The Bank Term Funding / protection program for the other banks is set to expire in March 2024. While the BTFP program seems to have prevented some bank runs there are reports of banks and insurers gaming the Federal back-up programs by arbitraging the low rates. Its not clear what the public sentiment will be if more exposes hit the news. It can be very lonely out there if the Fed’s not around.

    “The tables are empty
    The dance floor’s deserted”
    — Frank Sinatra, Learnin the Blues

    No position in PPBI. Generally long banks. Just my opinion. DYODD.

    Note: Market Watch just changed the tone of its story by deleting mention of the low coupon rate from its story and added a mention of increased income. Accentuate the positive – Bing Crosby

    1. Bear, I know of another bank that is in the process of selling off mortgages and securities that they plan to take a loss on for the 4th qtr. 800 mil worth they expect to close end of Dec. They also borrowed from the feds and need to pay back by March. I like seeing a bank being pro active and getting ahead of the curve. Bodes well and I am holding.

      1. Bear, I know of another bank that is in the process of selling off mortgages and securities that they plan to take a loss on for the 4th qtr. and net 800 mil worth from the sale they expect to close end of Dec. They also borrowed from the feds and need to pay back by March. I like seeing a bank being pro active and getting ahead of the curve. Bodes well and I am holding.

  22. There is some chatter that US Cellular is attracting some interest from the big 3 telcos. USM is controlled by Telephone and Data Systems. TDS and USM common both pretty much doubled when the “shop around” news first came out in August.

    TDS has two preferred issues outstanding, -U ans -V, both beaten up and both with healthy double digit QDI yields, around~11%. Pros: since apparently only USM, the sub, not TDS, the parent, is up for sale, go dark is not an issue at this point and the TDS preferreds may get a boost if TDS gets an influx of cash. Cons there may be no deal, TDS is a lackluster performer and there is family control. Disclosure: holding but not adding here. Just my opinion. DYODD

    1. I agree and am looking into it now. The common jump I missed. But this reinforces the pref’s IMHO to almost a safe investment. But there is complex wording in the backside of these. I’m hoping someone can figure it out here. But I’m guessing these move back to almost par if something transacts.

      1. I dont quite know what to think here. Are they selling the entire entity or just towers and such in pieces? And if they do sell USM, what is really left of the company? A scrawny landline and cable outfit?
        Moodys stated if they sold USM and returned the cash to shareholders it would be big credit downgrade. That wouldnt benefit the preferreds. Or would they use the money to pay down debt and spend heavily into their remaining tiny entity? That wouldnt help much either. In todays world 6% capital off preferreds is cheap. With the bulk of their entire revenue and EBITA generated from USM, what is left of the company if they jettisoned entire business?
        Interesting situation to see how it goes.

    2. Dan Loeb just disclosed his purchase of TDS and T Mobile. Berkshire’s Todd bought Sirius. Both are arbitrage plays as far as I can tell.

      I am evaluating Tapestry and Capri for arbitrage. Entered into Capri when SEC inquiry (expected) and earnings released.

      Happy I added to NVIDIA and MSFT. I buy monthly.

      1. I assume you mean these two guys have bot or added to positions on these names, right? There’s nothing on the table for Loeb to buy either one of the two companies or BRK to buy SPNT, is there? I don’t see anything, but then again, I’ve spent the day outside for the most part……

        1. 2WR, Yes. That is what I meant. Sorry for confusion. Loeb I think owns majority of float available however most of the company still owned by family. I can only suspect he will want the company sold for profit. Berkshire bought Sirius for the arbitrage between the two securities issued.

          I am increasing my exposure to Capri for arbitrage.

      2. I saw this. Just before I bought more of the TDS-V. I feel pretty safe with these and expect good ROI. Might be adding more, not sure why others are not piling in?

        1. One cannot know all that might be going on behind the scenes but for what is visible my reason would be: Ba3/B

          At 11%+ it does have a smokin’ yield on it. Good luck with the position.

  23. Anyone looking at DLNG? They have eliminated over 25% of their debt in the last 4+ years under refinancing terms in 2019 under a 5-year agreement.

    Solid industry, low price to book, and positive EPS. 6 older ice-breaker ships under contract, and they recently announced new higher contracts for two ships when their contracts expire in a couple of years. They seem to be keeping up with maintenance, and even older ships have a good resale value. No common stock dividend while reducing debt.

    Plenty of risks and problems. They certainly have a huge Russia war/Gazprom problem that can’t be overstated. They will need to refinance their debt next year, which will be at higher rates. They are in a cyclical risky business, and the loss of even 1 ship could be devastating. They have demonstrated no fiscal restraint in the past, and there is no guarantee they have learned anything for the future. They are an offshore company with murky financial controls. They could decide to incur more debt by buying more ships. They have two costly preferreds in DLNG-A (9.0%) and DLNG-B (8.75%, but it floats in 2 weeks above 11%).

    On the upside for the common stock, they could reinstate a dividend next year, which will boost the common. They could get bought like many of their competitors, although their preferreds (DLNG A and B) could suffer (I plan to trim my positions next year just in case). Current price is $2.54, and book value is $8+ depending on the source. I expect any buyout will be below book value. I have a small position below $2.60.

    This is definitely a high risk, so DYODD. But, things will change next year, and I think (hope) those things will be good for the common. However, I only put my play money into this one.

  24. IBRX was up again today. Still holding 2/3rd of what I bought over the last year. Not adding more at this point, because it’s 60 to 180 days before the FDA needs to respond or has to respond. The drug does what it is supposed to do with little to no toxic side affects for bladder cancer. Only reason it was not approved was the outside manufacturer quality control. Too much excitement and from stock flippers and they can lose interest just as quickly and the stock nose dive an lose half its value.

  25. This is for 2WR
    “Promise me, son, not to do the things I’ve done
    Walk away from trouble if you can
    Now it won’t mean you’re weak if you turn the other cheek
    I hope you’re old enough to understand
    Son, you don’t have to fight to be a man”
    Title of the song is appropriate for my circumstances when it comes to common stocks.
    I took over handling my wife’s account, and one investment I made I take responsibility for, that is investing in common stocks that pay no income. Actually only one, the other one is a bank that pays a dividend. That’s it 2
    On a few income stocks that are down at least while I hold I am getting paid, two come to mind MGR and GJH
    At any point in time your account can be up or it can be down. In general over a year this account has been down about 1-1/2% this includes the income that has come in and my wife withdrawing 3% in the last 11 months.
    Besides the several income holdings being down, the one common stock has been a major contributor to the loss. As of yesterday, IBRX recovered enough in one week that I was able to sell 1/3rd of the position for a 10% profit in 8 months of holding. The rest is still underwater. I was averaging down until I didn’t want to take on more risk. As of this morning the account is up 1/10%
    which is nothing.
    If this was a business, I would expect that inventory to turn over 5 or 6 times in 8 months at a profit. One turnover in 8 months for 10% is poor business and bad risk.
    So heed those words young investors, “Son, don’t do what I have done”.

    1. What pushed me over the edge towards ETFs was exactly the problem you describe. Having a handful 10-20 stocks the volatility of just a couple of stocks can cause trauma.

      Majority (80-90%) of my common stock portfolio got parked in VTI (Total Stock Market Index). Been set and forget ever since.

      1. The expense ratio is very low since it’s just a tracking ETF but the yield is less than a mm fund and for $10,000 I don’t get many shares so it’s not going to move the needle much.

      2. I’ve also been shifting to funds lately to add ballast to the portfolio and make it easier to run. Specifically, PEY and SCHD are pretty broad based and emphasize yield. Also, I’m old and eventually all this will fall into the hands of my wife and kids., none of whom have the time or inclination to do what we on the message board do to keep our portfolio healthy. The funds set it on autopilot. They just need to scoop out or reinvest the cash and I’m sure they’ll figure out that part . Full disclosure: I haven’t given up on individual stocks as I recently bought JXN and added to my O holdings. Also have recently added to RNP, a high yielding real estate focused fund.

        1. Hey JerseyVinny,

          As I set up the plan for my investments to be inherited, I went down a different path which I suggest to anyone who is planning to pass on significant money to a spouse who won’t/can’t manage investments: do her a favor and find a fiduciary wealth manager for her now. If you are managing the investments, you are likely in a MUCH better position to find and vet a good manager than she will be once you are gone.

          I have been asked to help sort out dozens of estates over the years, and watching widows with the “deer in the headlights” look when they realize they have to deal with investments convinced me to get a money manager to protect my wife who has absolutely no interest in managing investments.

          It took a couple of years to find the right person. We went through a few candidates and even started having a couple manage funds before I dropped them. I finally ended up with someone we have known personally for decades. We both meet with him periodically and she is very comfortable with him (one of my primary requirements). My recommendation to her is that when I go, she should take him all the brokerage statements and let him take over managing everything. She knows it will cost her a little money and that the returns won’t be quite what I have been making, but the money will be pretty safe and she won’t have to stress about it. Taking that stress off is worth it (IMHO).

          During the course of setting up the relationship with our guy, I decided to let him manage a slice of our assets (about 20%). He doesn’t make as much for us as I do, but he is much more conservative and a good “anchor” for me when I start taking too much risk. Having him onboard managing a slice of our money should make a transition to him managing everything a lot easier.

          Anyway, just a suggestion.

          1. Thanks for the post Private. We had found a fiduciary manager, but I have a certain distrust after having experiences at Edwards Jones and one I can’t remember when I was younger. Not that it was bad, but their ideas were not in line with mine at the time. This person has several clients who had been with Bernie Madolf so I guess if they are willing to trust another advisor after that..
            I like the suggestion of trying a advisor with 20% and building trust then by the time I am done with handling it myself or not able my wife can have someone she can let take over.

          2. I have had 2 problems with the subadvisor approach:

            1. It’s very hard to get an advisor to consider your whole portfolio in managing the allocations of their piece of it. You have to be able to define their job such that they can do it without looking at everything else, because even if they say they will do that, they won’t.

            2. It doesn’t take much trading by the advisor to ruin your tax strategy for the year. (And if the advisor isn’t doing any trading, it’s really hard to justify paying them.)

            1. Good thoughts David,

              The way I handle them is:

              1. I don’t ask him to take anything into consideration from the part. I manage. I want him to do his thing with his piece without him trying to “react” to my actions. Only “rule” I give him is “no cash, no bonds”. Lots of advisors look to something like a 60/40 or 80/20 split between equities and bonds. I told him I will do the fixed income for both of us – you just do equities in your part. FWIW, I will probably talk to him about bonds at our next review. World is changing.

              If I wanted him to look at my piece in detail, he would be basically managing the whole thing – or at least “leaning” his piece to counterbalance me. Not what I want.

              That said, when we have our reviews, he tells me his strategies and I try to articulate my strategies and get his feedback. Luckily, I have known him and worked with him on community projects long enough that he can be very blunt with me (i.e. tell me why my thinking is stupid – and he does). I don’t always take his advice/feedback, but I do try to park my ego and listen.

              2. I only let him manage IRAs and Roth accounts, so tax issues are pretty manageable (the bulk of our overall holdings are still in those kinds of accounts). Only real tax issue most years is whether/how much Roth conversion to do.

              1. I was discussing this same “money manager” topic on another board and someone asked me how to pick a money manager. I thought I might share that here. (if this discussion goes on any more, we should probably move it to the Sandbox).

                I confess, I found my guy kinda by dumb luck (or my wife’s prayers – if she prays for something, get out of the way…). I had been through several guys (people affiliated with brokers, fischer, etc.) and I couldn’t find anyone that fit. I was talking to friend, and he mentioned someone I had known for a lot of years socially. Turns out he is a fiduciary money manager who had just the right background for us, and we have worked with him for fifteen years now. He leads a small firm, and we also know his more junior folks, so we should have continuity if our guy retires.

                So, it is unlikely everyone will have a friend like that, so I asked a couple of people who are way smarter them me about how to find a good money manager and both recommended some recent articles from a group down in Monterey (think “Pebble Beach crowd”) :

                This one is from a couple of weeks ago:
                https://tinyurl.com/k936efmk

                and this one is from this week (I will post part 2 when it gets published).

                https://tinyurl.com/yt2dscp5

                Hope that is helpful.

          3. As a woman, please try to recognize the continual bias towards females. My female friends are certainly nothing like described here. That being said, I do understand that one cannot suddenly pilot the plane and safely land. I would suggest spouses not familiar with financial planning also work with the portfolio and financial advisors. There are many good spreadsheets and documents which we have in our safety deposit box. “Where is the money?” “Things to do when I die”, “Apple legacy key and such”. These documents have been reviewed by spouse, attorneys, advisor and sons. I am not social security age yet but am a practical person that loves my family.
            It is very difficult to find a trustee for estate. I also have friends that we trust; however, they are around my age. In my case, I realized I was avoiding making difficult decisions by punting to friends (CPAs, etc.). We have interviewed multiple trust companies. It is not easy. Most trust companies will not handle foreign assets or esoteric stocks. A compromise I am making is placing assets the trust departments will not handle into separate trust and allowing my sons to be co-trustee. Upon our death they will need to understand these assets. Leaving them under the trust companies assets would require immediate sell and that is not financially the wisest to do. Another complication is incapacitation. Then the trust company must step in and one must decide on their roles, who has the durable power of attorney, etc. Anyone that has worked and has assets is faced with this along with the sunsetting of the estate tax exemption. Hopefully all have taken advantage of this exemption and utilized. If anyone has an answer to all this, it would be wonderful. I suspect not.

            1. Hi TNTowanda,

              Apologies if I sounded like I was perpetuating bias against women. In this discussion, I have been mostly talking about my personal experience, and I am a man. I talk about “my guy” because he is a man. I also have couched my suggestions in the context of talking to men because that is where this conversation started (I probably should have shifted gears to a more general audience, but I am not that smart). I certainly think women should do the same planning and are completely capable of doing it – so I am sorry if I sounded like I was implying anything different.

              I am not on Social Security yet either, but almost all of the estates I have helped settle have been for men of my parents’ or grandparents’ generations who left wives behind. Cultural norms were different for them, and I have had to deal with things as they were.

              In the case of my wife, I certainly married up. She is far smarter and more organized than I will ever be. She runs a school for several hundred (mostly immigrant/migrant) students and she knows every one by name, and their families, and their situations…. She is the head of a regional charity, she has managed a PR firm, etc. etc. In the couple of years we lived in Hong Kong, she ran a 1500 member women’s charity. She can make spread sheets sing and has managed millions of dollars in budgets. It isn’t that she couldn’t manage investments – she simply has no interest. She knows our money manager and is happy to socialize with him, but I have to all but drag her to reviews with him because she has “better things to do”. She is the one who is the keeper of the documents you mention for our family (she says I would just mess them up). She also manages our bills, insurances, etc. – I traveled so much early in our marriage (40 years) that she took that on and confiscated my check book because I just kept missing things (one of the happiest days of my life!).

              Point of irony – my wife just asked me what I was writing (as a lead in to “why aren’t you making dinner”) and when I told her, she laughed at me. She reminded me that all of the CFOs of every company I have ever owned or started is/was a woman, because “you need a woman to boss you around”.

              I created a company with my daughter about 10 years ago where she is CEO and every one of the dozens of other people in the company (other than me) is a woman. It wasn’t planned, it just worked out that way. Amazing vibe – I just sit back and watch it go. The CFO of that company used to threaten me with bodily harm on a regular basis (and she probably could have done it – she was quite an athlete). She would tell me to just leave them alone and they would figure it out (and they always did). Unfortunately, she passed away last month – which is one reason this whole topic has been “top of mind”.

              Finding someone to act as a trustee sure can be difficult. My daughter is now the trustee (after my wife and I) for our family trusts, but when my kids were younger I had a similar challenge. I just couldn’t get comfortable with bank trust departments (too many idiots and they changed every five minutes), and as you said, they wouldn’t handle anything offshore or remotely complicated.

              My wife ended up sweet-talking an international tax attorney we know into taking on the job (I think she worked on his wife) on condition that I would do the same for them. That was great for us because he could understand our offshore businesses/assets. Luckily, neither of us ever needed to actually do anything for the other’s trusts. Unfortunately, his adult special needs son passed away last spring, so most of their trusts were terminated and I was released.

              Anyway, I apparently need to go make dinner – so, again, apologies for my tone and for how long this post has gotten.

              1. Private thank you for the posts. I think it was several years ago here on Tim’s site that people discussed why they manage their own investments was that certain ETF’s and mutual funds do have low costs but they don’t stay on top of changes in what they hold. Good example would be the recent issue with Riley or a preferred trading over par that gets called and suddenly drops to par.
                All the points that TNT brought up I am glad she listed them.
                The points about trustee and a executer I have had both good and bad experiences first hand.
                My wife’s sister took her father to the family attorney and had the Will changed, had all the assets and real property put in her name and emptied the bank accounts.
                The lawyer was a decent guy and he suspected my father in law was being manipulated and he left part of the will unchanged that said all the property in the house belonged to the other 3 sisters. We spent 450.00 to talk to Les Tillum a attorney who told us the estate was under a million and wasn’t worth the money or the mental stress to fight it.
                On my parents estate my sister was an Angel absolute Angel. She was care giver for our mother and the trustee and made sure everything was split evenly.
                In our current situation i’m not sure any of our family members are up to the task so I would consider a bank’s trustee to be more competent and even handed than any family members so the trade off is worth considering.

              2. Private, Thanks for an elegant response. I think it very common in relationships for one partner to take on duties while the other parties takes on other duties. That works until it doesn’t.

            2. TNT, I think some of it is just “non awareness anecdotal bias”. I even get in constant trouble from my lady for referencing our cat as a “he or his” when its a female cat.
              I have a circle of about 50 friends/couples or so close enough to where I know in general their investment styles. Only one other really is a “stock trader”. The rest is mostly real estate, index funds, CDs, or lean on financial advisors. So the guys in my circle arent really anymore attuned to this stuff than their wives are.
              With one exception which I thought was funny. One of our couple friends the wife just recently retired 4 years ago from a career in finance working with Dean Witter and ending up retiring from Merrill managing other peoples money. She told me she refused any client under $5 million because they were the ones that panicked all the time any time the market dropped. The ones with more wealth didnt worry and bother her all the time….A while back I proceeded to try to pick her market brain and see what her thoughts were. And she said, “I am sick of that $h!t. I dont follow it anymore. The day I retired, I moved our assets to an advisor and he handles all our money.”
              Her husband, my golfing buddy, probably doesnt even know where the money is at. He says she gives him a weekly “cash allowance” for his golf and beer activities and that is all he knows and cares to know about.

            3. TNT,

              We share your challenges re a Trust manager. Being transparent, many of our friends’ consternation notwithstanding, I believe a part of our own trepidation is the aversion of thought to paying someone to do a job I feel we can do better ourselves. That’s challenged of course by the notion we may have better things to do than spend too much time in front of a computer trying to tick off another few percentage points here and there. The other part is I really like doing it.

              Not knowing the entirety of your situation but recognizing similarities with our own would share the following:

              1) Have heard excellent feedback re Goldman and MS. If engaged, I would for multiple reasons opt for a Trust “team” rather than a single manager. My older son uses an MS team and has had consistently positive feedback.

              2) I have ongoing in-depth conversations with my partner regarding our investments. Among the least obvious benefits is the “surprise” “brilliant” feedback you may receive on points you may not have considered or that could be viewed differently. Originally with zero finance background, my partner can now critically evaluate credit risk, credit spreads, duration, equity derivatives and most-recently historical yield curve expectations and now knows her way around a basic income stmt and balance sheet. In an “aging” scenario you allude to, this in-home cross-check will be valued over-time like an aging fine wine.

              3) Your sons. Many do not like to discuss finances with their children. We have taken the other path and have normalized the dicussion with them. It’s a very infrequent conversation – but they are aware and have time to understand their own responsibilities that will someday – and maybe unexpectedly – land at their feet. Like you we have extensive spreadsheets for them, updated quarterly, with all the info…the what, where, why and how of it all. We too have sons and are fortunate in that one of them started in IB 14 years ago, and via exposure to our’s, the 2nd son has adopted similar financial disciplines and understanding of his own repsonsibilities to his family and someday to us. It’s been accretive for him and therefore by extension for us. Regarding the durable: The durable goes to one son, the directive to the other. They know and they understand. One for the brain, the other for the heart.

              My current base case is at some point the boys take over mgmt, which with provisos may be well-before our sell-by-date, and which may include handing it over to Goldman or MS. I’m comfortable with that being their call.

              For fun: The joke in the family re the one with the brain…if we get past a certain age and sneeze, he’ll say, “yeh, they had a good run, pull the plug” hahaha. So the directive goes to the one with the heart.

              Best to you with your decision-making.

              1. Alpha, We do share many similarities. I have spoken with the trust folks at MS (flew up with the local guy). Agree they are very sharp. Our estate leaves our attorney (who is only 40) as the protector so it gives me comfort if a change needs to be made he will facilitate. Our sons are still in their 20s and neither married. Too many unknowns at present to make them successor trustees. We also have a tender hearted son that I worry marrying the wrong woman could harm him financially; therefore legacy trust with corporate trustee. (It is tragic what I have seen. Recently, a son took distribution from his legacy trust and built an incredibly expensive home in Aspen; the wife now in divorce is taking most of the assets including that home. )

                And finally, we recently met as a family with our estate attorney. The sons will circle back again with him. My husband has a good awareness of our situation if I should pass or become incapacitated. He strongly prefers a corporate co-trustee with our CPA firm advising on an hourly basis.
                These are difficult topics but personally, I think both spouses and children should fully understand. Our dear friend is now being sued by her stepchildren as their father failed to communicate with them. He (in my view) faltered on a basic responsibility; though in totality he was a good person. The legacy he has left is one of anger, hatred and mistrust.

                1. TNT, We’re helping each other here. I read your post twice. A lot of good info and advisories. Yes two wonderful daughters-in-law joined the clan in the last two years. The unthinkable, however improbable, is still a possibility.

                  We have been planning to make the adjustments and you just landed a well-placed elbow.

                  1. Thanks to everyone for sharing, been up 16 / 18 hours straight and just landed after a 10-1/2hr. Flight. Still 8 hours to go before we get home.
                    After we rest up from our vacation I want to go over this again. Hope everyone has had a good weekend,

            4. Regarding this discussion about trusts, please see my question on 1/01/24 on this thread. I’d appreciate any feedback. Thx

    2. My cost basis in Microsoft is $25/share. I never sold (and it didn’t pay dividends). My children and grandchildren will inherit. I preach the same thing: Invest at a young age; eat beans if you have to but build wealth for your family. No inheritance just buy and hold with the gratitude that I as an American female have this opportunity. My NVIDA cost basis is similar. Looking at equities on a daily/monthly/yearly basis will not build wealth. Many times I was told to sell as I could get better returns, blah, blah, blah. The tax efficiencies of buying and holding cannot be beat. Do your research and invest. Funds are great too and I hold many. Personally, I don’t know anyone that became wealthy on fixed income alone.

      1. TNT listen to the women in the house, they have a long term view of things. But there comes a time you no longer want to work or can work, at that point the money quits coming in. Then your money has to work for you and pay you an income. My wife worked for Costco for 30yrs and bought her company stock at market price with 10% matching from the company in her 401k. She started out buying COST at 8 to 10.00 a share.
        But 356 shares of stock only pay a dividend of 1,452.00 a year. Not quite enough to live on when your seventy years old. With about 1/2 the IRA invested in preferred, ETD, and bonds its generating about $49,000.00 a year now and the IRA is still worth the same a year later even after she has pulled out 3%
        My wife is not as mad at me as she was a year ago when I sold the COST stock. It at depends where you are at on the journey through life.
        SO, yes I agree common stock is appopriate if your younger.

        1. Charles. I agree which is why I stated start early and eat beans! I am curious as to why your wife is not managing her own hard earned assets? She should! And I love my Costco stock, doubt I will ever sell. Another reason to love equities they allow me to focus on income generating work. I doubt I will ever not be doing something as I take joy in challenging myself.

          1. Funny you should ask. I started out in about 1982 with investments. Did some myself and tried a investment manager ( Edward Jones) invested in a stock purchase plan with Georgia Pacific which I used to buy my first house, did a 401k with another employer and when I was laid off I transferred it to a IRA in 2012 right before the company went BK
            I used to read the Wall St journal and when I had an early account witn TD I would read the paper booklet of stocks they sent me every month front to back.
            My wife on the other hand had a union job with the retail clerks union that she saved only 10,000 after 8 yrs
            And then her 401k with COST
            I try explaining what I am doing and her eyes kinda glass over. On the other hand my eyes start glassing over when she starts talking about one of the 2yr old great grandkids giving her mommy a funny face just like her momma did when she was 2

            1. I grew up in a more rural area and the local credit union had on offer CDs. So every 2 months or so I would lock in another 5yr CD @ 11% minimum required $500.

              In around 1991 or 2 CD rates had really dropped. So I started looking around for alternative investments. Had to travel 3 hours with a bag of cash to the major city to put money on deposit at a national bank which offered at that time mutual funds. After reviewing the funds on offer I picked an all stock index mutual fund with the ultra low MER Rate of 4%.

              After 2 years of receiving 3-4% returns which was below CD rates. I found out this same national bank had a brokerage service starting up. So I got an account. With my annual fund report in hand for the past 2 years found out the top 25 stocks equaled 45% of the AUM of the fund.

              So after waiting 2 weeks for my money to transfer into the brokerage. I called up the broker and bought the exact same 25 stocks exactly allocations as the fund and waited.

              Miraculously performance improved to 8-9% per year.

              On my statement it also listed cash. Even though I had not made a deposit in the account for over a year. So I called up the brokerage thinking a mistake had happened. It was explained those are dividends and its my money. So I asked what I could do. The agent then enrolled me in the dividend reinvestment plan.

              This rural farmers life was never the same again.

        2. I disagree, your common stock allocation should not be based on age, it should be bucketed. Everything beyond the 10 year bucket should be in common stock. As I’ve mentioned, a 70 year old should be budgeting to live for another 30 years.

  26. HIFS – Hingham Institution for Savings (Microcap Regional bank)

    Specialized mortgage lender with commercial lending operations in San Francisco. Recently this area has been in the news for big property value write downs.

    Net interest margin has compressed into oblivion due to deposit problems.

    No analyst coverage which also can cause stocks to be left out in the cold like orphan children in distress.

    Think this will by a flyer once rate cuts take place. Have taken no position but appears to be a highly efficient lender stuck in bad circumstance.

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