PPI was out and ‘hot’ this morning and while stocks tumbled and interest rates shot higher initially–it didn’t last long–now stocks are up and interest rates are off 2 basis points around 4.45-4.46%. Go figure. You can be certain the traders can always find a way to move markets so they can take some nickels and dimes from folks. Wait until tomorrow–we could see some real fireworks!!
I bought a nibble on the PennyMac 8.50% baby bond this morning at $25.40–there are 2 months of accrued interest in the price. This one was already in my portfolio–so this is just an addition. I will add it to the laundry list of holdings.
Users who liked this:
Tim, my memory is kinda grey, but didn’t you used to have spread sheets of different accounts dated by the year you started them? Was this something that became too labor intensive or they went away because they were part of your old site?.
Personally I have a rule that I don’t pay over par for a preferred/baby bond……but I like the yield
Slightly over par can be a good deal for yield because the price is suppressed due to call risk so higher divvy and less downside risk. Just not much price upside, depends on your trading goals. If it’s called just buy something else no harm no foul. not much harm.
Yea but you can take slightly less yield on something like 20%+ under par and just wait for fed to cut rates then make even more. I don’t like putting in a potential loss for slightly better yield.
25 on a 8.50% pfd w 2 months interest is about at par approx = 25.35. So he may have paid 5 cents over par.
For me I’ve always kept away from Penny Mac because of the name! LOL…………………Too cute/chintzy
I did see a black box research piece on PMT that have it high scores. VS CIM with low grades
There was a .3% revision downwards for both last month’s month to month and year to year PPI.
(Last month being March of course.)