Expanding $50 and $100 Preferreds Listing

As we have gone through the gyrations of the last weeks and months we again observe folks who maybe should (or would) consider buying some of the $50 and $100 preferreds out there that currently trade.  Maybe even some of the $1000 issues (and even a couple $20.75 and $25 issues) -unfortunately the $1000/share issues do not have price quotations that we can use in our listings so there is little use in trying to cover those issues.

In light of this interest in these shares we have added the 52 week trading range to the issues and we have added a credit rating column where we simply whether the issue is investment grade.  We have more work to do on the individual security pages, but wanted to remind folks that these issues are an option for the patient investor.

A fair number of the group of $50, $100 and $1000 issues fall into the category of “illiquids”, of which a number of website participants champion on a fairly regular basis.  The concept of “illiquids” is that they don’t trade often (or many shares)–in fact some may only have 1 trade in a year–so if you are fortunate enough to snag a few shares you have something for the “sock drawer” (a spot you put reasonable quality stocks and bonds that pay dividends reliably and may have been outstanding already for 50 or 75 years).  We should note that there are quite a number of issues on this list that trade a fair amount of volume – these, by definition, are not illiquids.

1 particular illiquid from Financial Institutions Inc. is a 8.48% cumulative, non callable preferred (ticker:FIISO).  This is a $100/share issue and trades so infrequently you have to dig pretty hard just to get a quote.  This is a Gridbird special.

Other illiquids aren’t even $50, $100 or $1000 issues.  There is one $20.75/share convertible issue and a $25/share issue–both from tiny Corning Natural Gas.  They trade once in a while.

In the end investors need to realize that the illiquids can be great for the investors that can put them in the ‘sock drawer’ and simply draw income BUT just because they are in the drawer doesn’t mean you can totally forget them.  Small companies like Corning Natural Gas (revenue of $34 million) and moderate sized banker Financial Institutions ($4 billion in assets) obviously have risk and are not investment grade.

Also one should know that because these shares trade so little that when they do trade it may be at a price significantly higher or lower than the previous trade.  This means if you hold an issue that you paid $100/share for may trade the week after at $95 or maybe $105 so you can get a little surprise if you are one of those that baby sit your holdings.

Additionally just because many of these issues trade in small volumes–or maybe only trade on occasion doesnt’ mean they won’t trade lower on higher interest rates–they will.

Disclosure–we personally own the following issues on this listing.

Tri-Continental (TY-) 5% preferred,  Corning Natural Gas 6% (CNIGO) and Connecticut Light and Power 4.96% preferred (CNTHN).  We have owned these for a few years.

The listing can be found here.

 

12 thoughts on “Expanding $50 and $100 Preferreds Listing”

  1. Thanks for the effort but already preferreds looking more liquid are illiquid so I don’t think it’s a great idea to add more thinly traded ones. Unless they expire in a couple of years and at least you don’t have to worry about selling them.

    1. Tim,
      Copied the vlookup line and got the quotes to load. Assuming it is pulling the quotes from the Quotes sheet? I don’t have much Google Docs experience.

      Thank you for the resource!

    2. Hi Tech Guy–vlookup is one way to do it as you found. The problem with that method is you have to pull all quotes into sheet 2 and then sheet one grabs them.

      On many of the issues I now use a snippet of javascript–i.e. it is more efficient for the needs I have on the website–plus it is totally ‘legal’ while others may/may not be kosher so to speak.

      =IMPORTJSON(“https://api.iextrading.com/1.0/stock/NEWTI/quote”,”delayedPrice”)

      To do this you need to have some scripting in javascript (in google docs)–

      /**
      * Imports JSON data to your spreadsheet Ex: IMPORTJSON(“http://myapisite.com”,”city/population”)
      * @param url URL of your JSON data as string
      * @param xpath simplified xpath as string
      * @customfunction
      */
      function IMPORTJSON(url,xpath){

      try{
      // /rates/EUR
      var res = UrlFetchApp.fetch(url);
      var content = res.getContentText();
      var json = JSON.parse(content);

      var patharray = xpath.split(“/”);
      //Logger.log(patharray);

      for(var i=0;i

  2. Tim, that FIISO issue is almost owned entirely from a founding family that got them at issuance in 1998…A ticker was assigned later but clearly they dont sell. A few years back I had my broker dig for some shares. Basically about a 1000 shares were “found” and traded within a few months. I got 300, Inspbudget got at least 200 and another friend of mine got 200. So the 3 of us largely got the bulk of any that have really traded in years…if ever.
    This is the ultimate sock drawer issue…But I do own shares of one preferred that has went 12 years without trading though too, lol.

    1. Hi Grid–I found a trade back in 6/2017 on eTrade–don’t remember the size–obviously small.

  3. Tried to place a limit order for CBKLP in my Schwab account and it would not take the order. Turns out Schwab classifies all three of CoBank ACB preferreds
    as “institutional only”. Oh well, not the only fish in the sea.

  4. Excellent idea and thanking for sharing the sock drawer concept. My portfolio had now been restructured to have two components. (1) Issues that I will hold for next 5 years (high quality companies with floating rate) including UTE’s like NISOP and (2) “Term preferreds”.

    I am looking to start slowly building a “sock drawer”. This list will likely help.

    Now, my approach to “term preferred’s” is different. I offer for others who want “term preferreds” to be credit bureau rated. They are all companies who have their 1st call in 2019. Most were not affordable or too much of a premium in the past. If they are not called after a few months of call date, I may exit them. They are not real term preferred, they are “psuedo”.

    In normal things, they should hold $25 per share. They are PSA-Y – A rated (6.375%), KMPA – BA1 rated (7.375%), BAC-W – BAA3 rated (6.625%)and AFGE – BAA2 rated (6.25%).

    Now for the sock drawer and perhaps adding to the positions above.

  5. Fantastic! I have three of the $1000 par issues: MTB-C, WFC-L, BAC-L. They trade fairly often but not usually in large volumes. I actually prefer the larger par issues as they tend to be less volatile. They’ve held up very well during all the recent turmoil. Looking forward to your expanded list.

      1. Retired, I also have all 4 of the issues you mentioned above. Excellent “sock drawer” residents – will not sell, just hold until called or passed to kids.

        Will also add if opportunity arises – like MTB- for example, earlier this week.

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