As we had mentioned some weeks ago we needed to rebalance somewhat in the High Yield Model Portfolio as it was way too heavily weighted in LNG shipping stocks.
The model had 2 different GasLog Partners issues in it which totaled 600 shares as well as 400 shares of TeeKay LNG Partners which in total were almost 25% of the modestly sized portfolio.
We sold the Gaslog Partners 8.2% f-to-f preferred (GLOP-B) issue booking a capital loss on the shares of around $500. In place of this issue we purchased the Arbor Realty 8.25% perpetual preferred (ABR-A).
We have been impressed by the turnaround that Arbor Realty has in place now. While we could have purchased the 8.50% issue it becomes redeemable next month. The issue we purchased already is redeemable, but it seems logical at this point in time that they would call the 8.50% issue prior to any threat to the 8.25%. We really doubt they will redeem either of the issues.
This leaves the model portfolio with around 13% cash.
It is noted that this is an educational model portfolio meant to show newer investors the results of investing in high yield preferreds. Of course high yield means high risk and this may or may not be suitable for many investors.