Wow this market (both stock and bond) was totally slammed today. The 10 year treasury racing ahead by about 10 basis points to 2.03%—way too fast for my comfort.
A little bit of heat in the CPI could have been tolerated but a month over month increase of .6% is the absolute worst news imaginable. While the year over year number was just slightly warm, the month over month suggests no lessening of inflation.
Today preferreds and baby bonds were hammered fairly hard–on the week the average issue is off around 1%–of course some are off much worse than others.
There have some issues that have been knocked down very hard that I would have guess would have held up better. For instance the Arbor Realty Trust issues were slapped down again today by 2%. They have 3 issues outstanding and 2 of the 3 fell to $22.50 and $22.90 respectively, which puts the current yield near 7%. Disclosure I own some Arbor Realty Trust preferreds. For some new investments in perpetuals I would think one would want to target mid quality issues at 7% or higher.
For now I keep watching the short maturity issues–baby bonds and term preferreds which can be seen here. These issues have held up well compared to the perpetual preferreds, although they are off their highs. I won a fair number of these issues–in fact probably 80% of what I own can be found on this page.