Long time publisher Doug Le Du is shutting down his various preferred stock and baby bond services. No particular reason was given for shutting them down.
This, of course, will reduce options for folks to research and discover income issues.
At this time Doug is offering his book “Preferred Stock Investing” 5th edition for free in ebook format. It is a basic book–for me not too helpful, but for some newer investors maybe it would be helpful–plus the price is right.
You can go here for a download if desired.
See my post at https://innovativeincomeinvestor.com/reader-initiated-alerts/#comment-40215 for the message Doug sent to CDx3 subscribers about BNK purchasing his service.
Has anyone tried the Preferred Stock Investing service offered by BNK Invest, Doug Le Du’s successor? While Tim McPartland’s site is fantastic, I would also like access to a canned service that provides specific actionable recommendations on exchange traded bonds and preferreds. That is trustworthy and relaible.
Yes I subscribe to that service. For me the value continues to be the database (what Doug and now BNK refer to as the “Preferred Stock List”). See my 02 oct comment just below for the attributes it tracks. As Tim pointed out, you can find most all of those attributes on III (this site). What I value, though, is the presentation in a tabular format which is updated frequently. It also has useful sorting and filtering functions.
It is not perfectly complete by any means (my experience with III has shown me that), but it is complete enough to have value for me (it currently is tracking 934 issues).
I use it as a complement to III (which continues to astound me for its community and depth).
In my experience, the BNK service does *not* provide specific actionable recommendations. It is just presenting data.
Hi Bur–yes a person needs a couple resources to cover the basis. Maybe with time I will get new databases similar to Doug’s site–just need the time to put it together.
Bur & Tim,
Thanks for the quick response. I am a novice on preferreds and ETDs but this asset class has a significant role in my portfolio. All this takes time and having an independent database to refer to helps. I plan to subscribe to the BNK service.
When you start trying to track all ~ 934 preferreds and keep the information up to the date, you realize it is a full time job. I speak from experience. It probably takes 40+ hours a week to achieve 99% accuracy. You can forget about getting to 100% accurate. The second you get to 100%, something changes and you have NOT updated it.
If you spend all of your time trying to get and maintain perfect data, you probably are shortchanging the time it takes to provide more actionable investment decisions. As an individual, you can choose to do one or the other, or you can do a half baked job of both. If you do not have to sleep all week, you could probably do both.
A good example of getting to 100% accurate data is the list of preferreds that I posted recently which what I thought had suspended payouts. It took many responses to figure out that some of them were paying out. On others, we never got a definitive answer. Or take Grid’s recent scavenger hunt: OCESP. Nobody has figured out if it is currently paying out or not. How many hours would it require to get the 100% correct answer on this one security?
BOTTOM LINE is that you will have to deal with imperfect data, some helpful advice from here (III) and have to make your own decisions in the end. Maybe there is some trustworthy advisor on Seeking Alpha, but I am not aware of them. We do know of several advisors there that have given very poor advice and then denied it.
If somebody buys 1 share of OCESP and waits six months, they’ll find out if it’s paying!
Karma, I get the 1 share buy idea. But now explain to me why someone Oct. 27
of this year paid over $149 for 56 shares. Your probably gonna have to think hard to give a sound cogent investor perspective answer, because I cant come up with one, lol…
Karma, funny you should mention buying 1 share to see if it pays out or not. I have been thinking about it. As of yesterday I am tracking 933 preferreds/babys/terms that have face values of <=$100. I do track $1,000 and $100,000 face issues but we will leave those out of the discussion for now.
If you bought one share each at the last closing price, it is only $20,474. Obviously you might not get filled on every order at the last close price, but that is close enough for us. I would do that in a heartbeat. . . but . . .
This creates a much larger rabbit hole to fall into. How do you track all of the issues to make sure they are paying out? If you do that manually, it will take a lot of time. So you need to automate it something along the lines of "if ABC has NOT paid out a dividend in the last X months, then flag me so I can investigate it." X would have to be set differently for monthly, quarterly and semi-annual players. So you automate it, then a human has to look at all of the flags to make sense of them. . . another rabbit hole.
I am not aware of any off the shelf software that will set up flags like this. So you would have to create custom scripts to do it. That is not all that hard to do and we have talked about doing it.
So I see lots of hours of work with questionable ROI. Probably have a lot of other areas to spend time on for a better ROI. . .
Tex, I have owned a lot of the most obscure issues on OTC and never have had a problem getting paid. Besides most issues clearly show an exD date. So that shows they are paying. Only a very few such as Ocean Spray have no information mentioned.
You make me break out into a cold sweat thinking about having to monitor a 1000 issues, ha!
I am sad to see Doug’s cdx3 service go. I hope that someone steps in and keeps it going. Does anyone else know of a service which collates in one place all these data points about the current universe of pfds and etds:
– IPO Date
– Symbol
– Preferred Stock Name
– Dividend Rate
– CUSIP
– Last Price (with link to MarketWatch chart)
– Volume
– Yield (Current, YTC, EAR)
– Ex-Div Date
– Call Date / Maturity Date
– Liquid Price
– Credit Rating (Moody’s / S&P)
– Exchange
– Prospectus (link)
– Status (blank, QDI, Deferred, Called)
I ask this *not* to challenge, but sincerely: I am relatively new to Preferreds (2012), and I honestly don’t know where I can find such a resource.
bur–most all of those are on this site.
Tim, perhaps you missed my earlier question…. on the YTW calculation in your Google sheets, does it not assume reinvestment of dividends? I ask because the values in your sheets are consistently lower than Doug’s YTC and I believe his calculation does assume reinvestment of dividends/interest.
rk160–sorry I missed it. Yes they are always lower by 1% (+/-). Eventually I will change that–but the calculation to get it exact is too intense for google sheets–it just sits and spins. My plan is to totally do a new database when my ‘real job’ slows/ends, but it is a costly and time consuming change—given that I earn 0 off the site I have to cut corners where I can.
I think I will put a note on the page indicating this item.
Thank you Tim, and I will add my voice that I would be willing to pay (or make a contribution) for access to your data base. I know you have costs involved.
Thanks rk–I have plans that will include a little donation–but until I can give it my full attention I can’t do anything.
CDx3 Notification Service Has Been Acquired by BNK Invest, Inc.
Know nothing about the new owner
https://www.bnkinvest.com/ They own lots of websites
Has anyone offered to take over his database?
Obviously, with the churn of issues is this low interest rate environment, the data will predictably become stale as new issues come on the market and old issues are redeemed
Too bad about Doug as he seemed like a great person and a real asset to the hobby. Any time someone leaves, we always feel it, directly or indirectly as the pool of the good people shrinks. Here’s the best to Doug.
Right Marc–agree with you.
I agree, he got me started down a good track. The early notice service was very useful to me as I was building my initial portfolio but since US yields dropped so far I’ve not spent much time over on his board. His database was very useful.
@Tim W: hear hear.
I made comments about Doug LeDu on the Reader Alert section of this site recently.
I want to add that I believe he basically was a statistician. That was his forte. And he was one of the best I’ve seen apply his abilities to formatting an excellent source of data re preferreds.
On the other hand, I never felt that he had the experience in actually investing in preferreds that some have who write about them – mainly Tim.
In one of Doug’s earlier editions he mentioned his father’s interest in preferred stock investing as a traditional preferred stock investor, I liked that because that’s what I am – a traditional preferred stock investor not a pinball wizard or Ken Winans technical signal preferred investor.
However everyone sees things differently, has different goals needs, etc. with their investing so I have no problem with different perspectives and enjoy reading about them even if they don’t work for me.
I tried googleing Doug several times to learn more about him but was unable to find out much. I think he may have worked as a non accountant for a Big 6, Big 4, Big 2 or whatever firm and perhaps lost his job or retired from it and then decided to get in the preferred stock information business. My cousin was in a similar situation the last time the Texas economy blew up, My cousin lives in Dallas.
But I want to stress again that he had real abilities at presenting data in a useful fashion thru his data base and I thank him and salute him for the work that he did.
On this thread, I’m starting to see some of the invective that has permeated Seeking Alpha.
I can’t see any connection between Ken Lewis, Angelo Mozilo, Countrywide, B o A, and Doug Le Du’s now defunct column.
Let’s keep the postings informative and constructive, folks. Take your knives, sticks and torches someplace else.
Thanks.
Well said Ron
Thanks Ron
Man, I didn’t even know about that preferred search engine. I would have gladly paid for it. I hope someone carries the torch on that. Would be sad to see all that IP go into the waste bin.
Landlord–if I could get rid of this ‘real job’ my plan is to eventially move to a similar system–of course I have said that for a couple years now.
Tim, here is the plan:
1) Tim takes a poll to see how many current Innovate Income Investor readers would pay $X annually for an upgraded search engine.
2) Tim calculates how many paying subscribers it would take to replace his other income and do this full time
3) Tim takes the leap, retires from his other job, does III full time.
4) Only hangup might be Mrs Tim, who might not approve of the plan. I am hearing many stories of unhappy spouses due to both being at home full time.
I would advise anybody thinking of running an investment site like this full time to correspond with Blue, who has run Investor Village for years and who can tell you a lot about what it’s like, warts and all.
JMO
camroc–yes I suspect it isn’t what it may appear to be. Part of the reason I don’t do subscription is that I don’t have to be ‘perfect’. Unless I could devote 10 hours a day to it I wouldn’t consider it.
Tex–haha–you are right about Mrs Tim. She went from a mid level management job at General Mills to now being a helper at our local Catholic elementary school–talk about a pay cut and she isn’t drawing her Social Security because I pay her too much to help me.
On the other hand it isn’t too much about the money–for 14 years I have come out of pocket. Of course my old site had advertising and when I sold it I recaptured my investment many times over.
Tim, you run the unchallenged best preferred investment site on the web, and your loyal users will contribute when you are ready to dial back your appraisal business.
Tim you are not going to give up appraisals so let’s face it! lol. Bea
I bought Doug’s book a number of years ago and it has really good material for anyone that is newer to preferreds and baby bonds. I’m sure readers on this site would find it helpful reading material.
I believe he said his eye sight is failing making working on the computer difficult.
Thanks Barbara!
I am still a current subscriber to Le Du’s service mainly for his “ENGINE” able to monitor some 260+ preferreds and baby bond positions (most of time with dividend info, Ex Div date plus prior dividend history [actually the lady who works for him using Yahoo feed missed a whole bunch of divvies, e.g. SLMNP (Gridbird’s) or even old RLJ-A. Sometimes, Fidelity.com was kind to give DIVIDEND info. I always made a print file on WORD and try to insert some useful info. Like many in your WEBSITE said, many including me will be happy to donate money for your WEB site, which is substantially superior to Doug’s. He made the claim that his picks never lost any money, mainly because the crook Bank of America CEO bought the entire crook Countrywide Financial. Apparently that prevents SEC tracing how the BAC CEO got away by stealing hundreds of millions of dollars. Obama and his not so honest Treasury chief (who forgot to report his income tax) decided NOT to pursue the thief. Yes. His book was overly simplistic. I liked Cash Is King by Simon Wadsworth much better.
Bank of America CEO Ken Lewis was one of the biggest banksters on Wall St….along with Angelo Mozilo, the sub-prime snake oil salesman from Countrywide. Both those frauds deserved criminal prosecutions, not tax-payer funded golden parachutes. Not much has changed since then either…just this week reports show over 500 JPMorgan employees applied for and received PPP funds designed to keep small businesses from going under during the pandemic. The US banking system is rotten to the core.