Sandbox Page

I will be adding a new link titled “Sandbox” in the right hand menu.

That link will get you to this page.

I had originally set up the “Reader Initiated Alert” page for ‘alerts’. I was thinking this, for instance, might be when a preferred stock is undergoing a temporary selloff and someone wants to let the population know about it quickly. Of course we all (including me) use the ‘alert’ page for general messaging.

I am requesting that we start using the Sandbox page for all general talk, and try to preserve the ‘alerts’ page for ‘alerts’.

I have had a screen up on one of my monitors all week where I see all comments – no matter where they are posted–it is a great page and I wish everyone had a page like that–believe me we all benefit from all the knowledge being shared. I don’t want to stifle any of the exchange of knowledge, but hope to get things a bit better organized by adding the Sandbox page.

482 thoughts on “Sandbox Page”

  1. A strange phenomenon that I saw today.
    I have an TD account and Merrill Edge.
    3 hours ago I put in the same order on both TD & Merrill. This was just for some extra cash I have sitting there.
    100 shares of SCHO at 50.60. Exact same on both.

    I checked back just now and the TD order filled about 45minutes ago but Merrill is still open. Is this likely just a one off? Or is it usual for some brokers to get better entry points than orders?
    Doesn’t matter to me, I just thought it was funny and in my short 10 year investing life it hasn’t occurred prior.

    1. Tdubz, It happens to me every now and then. Also on grey market IPOs too when I put bids out from 2 brokerages. It just boils down to which market maker they send it too. At least that is the reason they give.

      1. Tdubz and Grid, the issue could be that the same firm has a buy and a sell of the security at the same time and same price; they just cross the trade instead of going to their market maker.
        “In the middle of difficulty lies opportunity.“
        Albert Einstein, PhD (Genius, Physicist, 1879-1955)
        Nomad

        1. Nomad, Im sure you know the ins and outs more. And I suspect none of it benefits me, lol…Did you check crazy PFX closing price today? Back to $17.50. Next trade will be $15.50 Monday, lol.

          1. Grid, I spoke with the fixed income trader at VGuard today and was inquiring about the bond (just to see where it was trading). When they called me back it was $18.30 (!) offer, so the nice close of $17.50 sounds about right. We got paid our quarterly interest this week and that always makes me feel better. Just about 12 years left until maturity, we are senior debt holders and the insurance company looks like their business/assets are strong. Unless Phoenix/Nassau Re tenders at a fantastic number, I’ll just collect the quarterly interest and wait https://nsre.com/financial-strength-of-our-insurance-carriers.html
            Have a great weekend, Nomad

    2. When the broker accepts bribes for order flow you won’t necessarily get the best fills. It may be a one off but pay attention to see if that broker becomes a two off or a three off.
      Grey markets are inefficient and favor the institutions, lots of anomalies there.

  2. Been thinking a lot about quality and duration risk. Today I sold COWNZ with about a year and a half to first call at $26.09 – a couple of dividends. ( I know interest payments) Replaced by adding the same amount of CHSCM. I already have a pretty good amount there. Gave up a bit of yield but more time to first call, neither is rated but CHSCM seems better quality and more straightforward business. Plus fewer positions to monitor. Thoughts?

    1. Timdman: I think it is a good move. I did something similar today. I sold some TANNZ baby bond shares that I had about $700 profit in and added to my NLY-I and NLY-G positions. TANNZ has an 8% div but was the riskiest thing I owned. I will take the profit and a little less div to SWAN.

    2. Timdman,
      I own CHSCN, but took a look at CHSCN, CHSCM, and CHSCL.
      The one with the longest call protection is CHSCL with a first call of 1/2025. It also is yielding the highest of these 3 now, with a yield of 6.77%. With just a bit over 5 full years of call protection, CHSCL seems like the pick of the litter to me (right now). I am concerned about the revenue to earnings ratio from this group. Frankly, it sucks. I do like that the divvies are QDI and cumulative on all 3. Lots to like here, despite the ‘high’ price per share that some will see and be turned off by.

  3. Priority Income fund E issue seems to be the highest yield to worst at 6.45%
    This includes it being bought at ask of 24.89

    1. The fact that Priority Income fund is not publicly traded makes it a non-starter for me, being deep into retirement I can’t tolerate potential shocks to my meager capital with a black-box company.

  4. One of my SA “friends” asked me my advice about investing to protect their families future, below is what I sent back to them:
    I truly thank you for sharing your background with me. I am very aware of the excellent pension plans where you live as when I was managing money, I had a few clients that were very wealthy residents of the Netherlands. I have always said that IF I could restart my investing track record from when I was a young kid I’d only buy/invest in the VOO. When I was in college, I inherited a very large amount of AT&T before the US Federal Government forced them to break up their monopoly and I got pieces of each of their divisions. My grandfathers broker “Stanley “ the Lehman Brothers told me the worst advice, “sell all the baby bells and buy back AT&T”. My older brother (also an attorney) kept his intact and recently told me the position is now worth over $10+ million dollars as he has never touched the shares except to sell Lucent Technologies many years ago. I was fortunate enough to be able to retired in my late 40’s very comfortably and believe in my “retirement” I spend too much time managing all these positions I “accumulated” over my investment management career. I have begun to simply my portfolio and would encourage you to spend more time with your family, developing other business ideas or just doing sports activities instead of worrying about or spending hours each week thinking and trading the markets. Time and again it is proven that just buying the S&P 500 or a simple broad based equity ETF (like VOO) consistently beats every other strategy. Personally, I have found no one is magic on SA and paying for their newsletters (though interesting reads) is a waste of cash (sorry, I like to be direct). NO ONE can consistently beat the S&P 500 and if they do for a year or two they seem to beat their chest and take a victory lap; then the next year comes and they greatly underperform the index. Please read jlcollinsnh.com/2011/06/08/how-i-failed-…/ He talks about important life lessons and on the investing side to ONLY invest in the VTSAX The Vanguard Total Stock Market Index Fund. I know they are boring, but they work and the key is to have a great retirement with little volatility and to protect your family https://jlcollinsnh.com/2011/06/08/how-i-failed-my-daughter-and-a-simple-path-to-wealth/
    I would be glad to help you in anyway I can, please just reach out to me.
    Be well my friend and please consider my advice, Nomad

    1. Sage advice, Nomad, from a man who just spent 3 hours this week reading reports on money market funds of all things…. LOL! Just jerking your chain a little bit for fun, Nomad… Probably all of us who enjoy each others company here on Tim’s site are guilty to one degree or another of spending too much time trying to maximize our performance in the financial markets when it could be better spent on those people in our lives who matter more. We do it because we enjoy it, but as always we need to remember what matters most in life and it ain’t this…. In the words of John Popper, “It won’t mean a thing in 100 years.”

    2. Good advice for passive investors. I’ve done very well with active trading. This is my only source of income and I don’t have enough money to retire on passive income. Also, it’s fun. I’ve always enjoyed games of strategy and this is one of the best!

    3. This is the sort of fine advice I recently gave my 21-year-old niece when she visited from the west coast. Instead, she invested her savings in an old VW hippie van, refurbished it, and (sort of) learned to handle a stick shift before burning out its clutch on the grade between Kingman & Needles.

      “Ah, yoot.” –My Cousin Vinny

  5. Here’s one for you all. IIPR – Innovative Industrial Properties – a REIT that buys (and / or leases) buildings and then leases them to marijuana growers has a preferred. IIPR-A 9% coupon. Saw it at $29.46 just a while ago. It was up to $34 back in July! I’m pretty newbie here, but that seems to be trading at a pretty steep premium….

    Yield chasing + marijuana craze = something out of the ordinary

      1. Hi Bob (I’m assuming in Delaware)

        Actually, I think it was you who inspired my name on here…..

        I live near Grand Lake CO. About 10 miles from the West entrance to Rocky Mountain National Park.

        1. Hi Mark – yes, indeed, I’m in Delaware. I stole the name idea from my brother, so I claim no intellectual property rights to the concept.

          I am headed to Colorado for almost 3 weeks in December. Denver and Boulder with a possible side trip into the mountains. Spent a lot of time in Estes Park in my misspent youth.

          1. Hi Bob, If you find yourself in Grand County and want to put a face to a name, look me up. We could grab a coffee or a beer or something. Best way to contact me would be through email or text. 970 531 4590 or cayenneman014@gmail.com (hope it’s ok to share that info on here)

    1. I bought the IPO and cashed out at $26+. Big mistake. The risks are lower now and the high coupon is driving the price up. You don’t have to hold until maturity, sell sooner and make more than 3%.

  6. AVGO-P, Broadcom’s 1000 conv 8% pfd, has been on fire since issue, up to 1071.. I was going to nibble if it traded at or under 1000 but like so many issues, up up and away..

  7. Et Al, I just wanted to update everyone on some money markets analysis. Last night I read almost 3 hours of reports (I’m traveling and needed to do something exciting) on all these “new” money markets that are being touted for “enhanced yields” . I came to the conclusion to sell my TMCXX, MCSXX and PVOXX as they definitely are able to “break the buck” if we have any another/when we have another liquidity squeeze or meltdown. I bought TFDXX with all the proceeds as they have 99.5% of their short portfolio in US Treasuries and the rest (by design) is sitting for redemptions; the current 7 day SEC yield is 1.78%. I will take a bit less to sleep well at night with my liquid cash…
    Hope that helps someone here, Nomad

    1. Thanks as always Nomad. I took a peak at TFDXX, but not available via
      Fidelity. Your contributions, such as this, are very much appreciated!

      1. Thank you all so much for your kind and touching words! If anyone here has a money market fund or closed end fund they would like me to look at, please just post the symbol and I’d be glad to do the analysis. I will only give my opinion and each of us still needs to do their own due diligence before investing.
        The stock market is filled with individuals who know the price of everything, but the value of nothing.” – Phillip Fisher
        Nomad

        1. Nomad, I’m interested in a few CEFs and would be most grateful for your opinion. Morningstar ranks these as 5-Star: SZC, BME, and DMO. Thanks!

          1. mikeo, thank you for asking and just remember these are only my opinions and I may be a bit biased after my 24 years managing money on Wall Street…
            SZC:
            Average return since inception +0.16% per year is horrible since it’s September 2012 start
            Trading at a -13.05% discount to NAV; the 52 week average discount is 10.24% and distribution rate is 12.69%
            2.75% total expenses with 0.79% is interest is too high for my liking
            Paying out .1367 monthly and earning just 0.0379 is not good
            Z Score last 3 months is 0.40
            11% is leveraged but the cost is .79% is high
            Last 12 month total return is horrendous at -18.40%
            IF energy starts to rise dramatically my belief is that this fund will still underperform and I would stay away from it…

            BME: Healthcare CEF
            Premium is just 0.35% to NAV
            Distribution rate 6.42%, pays 0.20 per month but only earns 0.0089 not great
            Expenses are only 1.12% that’s good
            12 month total return is +2.23%, but has averaged 11.99% per year since its September 2012 inception very good
            Z Score -1.00 is excellent the last 3 months
            Primarily a USA holdings fund with 92% US based companies
            Well diversified with104 holdings
            I like this CEF but you may want to compare it to ETF VHT

            DMO: Definitely a junk bond fund and not for widows and orphans
            HUGE premium of 12.09% to NAV (Ouch) 52 week average premium of 7.55%
            HUGE Expenses of 3.12% with a interest expense of 1.41% on 32% leverage is just too high
            Cut distribution twice this year and pays out 0.15 monthly while earning 0.1336
            12 month total return of +12.27 and averaged 14.7% since inception is very good, but interest rates have plummeted and this find will get hit hard if/when interest rates rise or there is any credit crunch because it’s is scary at 98% junk rated (32% CCC and 59% Non Rated)!
            Way too risky for me (I’d rather go to Vegas)…

            Smile, Nomad

            1. Nomad, thank you so much for spending your time helping increase my, and others here, understanding of a fairly complex task — investing for income. Your efforts are extremely helpful.

              1. mikeo, it’s truly my pleasure as we are all here to help each other navigate through these volatile markets.
                All the very best, Nomad

              1. Tim, I have a feeling my “salary” will be about what you have paid yourself for running your outstanding III finance site!
                Maybe some homemade baked goods would do 🍸
                Hungry,
                Nomad

            2. Nomad
              Thanks for the review. BX has a series of funds which claim to be sector funds but actually are covered call funds. BME is one but BST and BSTZ which is a new one are all among this group. They all have done well but investors should understand that you are essentially substituting some capital gain for income with these funds. For example if you look at the total return of BST and goldman’s open ended tech fund BGSIX you will find that while both have done well, BGSIX has actually done better. I like both but one for growth and one for income.
              Another covered call fund in a tech wrapper is STK which has also done very well. I own STK now and have been a happy camper although in terms of total return BGSIX has done better. But I need income to balance off low yielding munies and stk and or bst provide it. Like preferred offerings you have to watch them and letting them fly strictly on auto pilot is unwise.BME I think deals in healthcare and I would be careful there as both political parties seem to want to do things to reduce pharma’s income. As such taking another sector until this clears up might be prudent.
              Finally have been looking for a non pimco fund holding MBSes. Right now BKT is the apeal of my eye. Would value you take on it or if there were another to look at, would welcome the suggestion. Best SC

              1. Good evening sc, I’d be glad to give you my analysis on Fannie and Freddy Agency Mortgages CEF BKT:
                Current has about a 5% discount to NAV and the last 52 week average is 6.6%
                Distribution rate is 6.78% Average coupon 2.78%
                Funds inception initial price was at $10.00 and current prices is $6.09 (!) In a continuous lower interest rate environment this is unacceptable for an investor.
                32%ish leveraged
                Paying out 0.0344 monthly and earning 0.024 is not good
                UNII is a negative -0.073 which is poor
                Total expense are 1.8% (1.03% Management fee and 0.76% interest expense) is acceptable
                Z Score is +1.30, is not good and looks expensive
                Since inception the CEF has averaged 6.6%; that’s fine, the current managers took over in 2016 and their track records is:
                2016 +4.27%
                2017 +2.57%
                2018 -2.59%
                YTD +12.87%
                The CEF has turned over their portfolio 373%, maybe too much trading and this could be because of refinancing principle pre p-payments as interest rates have moved dramatically lower
                If I was long this CEF I’d be a seller at this time as this is their best year n6 far and I’d be quite cautious because the duration is very long and they are not earning their monthly distribution
                Hope that helps, Nomad

                1. Nomad
                  Many thanks your review. Is there an MBS fund which you might suggest that one look at to replace this BKT? Would value your suggestions. Many thanks. best SC

        2. Hi Nomad,

          I’m looking at simple next to no risk money market funds I can park my sitting cash in Edge account while looking for opportunities that have a low yield but also low expense ratio. Unfortunately the one you mentioned isn’t available for purchase. But looking for things that are as close to risk-free so able to easily move out of them.
          Anyone ones I’ve looked into are PULS, JPST, ICSH.
          Please let me know if you think any of these are suitable. Or if not, if there are others I should look into and see if available on Merrill Edge.
          Really appreciate the offer and all your comments here. Thank you

          1. Tdubz, my first question would be are you looking for zero price exposure as the money market I eventually moved my short term assets into is TFDXX with 99.5% US Treasuries will no real risk. All 3 of these are ultra short quality bond funds but IF the short term interest rates rise or the Fed some day in the future raises the Fed Funds or Discount Rate these funds will definitely go down. The 3 funds PULS (PGIM Investments, their first ETF, the PGIM Ultra Short Bond ETF) ranks #50 YTD of 201 Ultra Short bond funds, JPST is (JPMorgan Ultra-Short Income ETF) ranked #35 out of 201 YTD and ICSH (iShares Ultra Short-Term Bond ETF) #43 out of 201 YTD.
            PULS:
            Trailing Fund Category Index
            Alpha — 0.27 —
            Beta — 0.03 —
            R2 — 18.80 —
            Sharpe Ratio — 0.74 0.18
            Standard Deviation — 0.44 0.49
            JPST:
            Risk & Volatility Measures
            Trailing Fund Category Index
            Alpha — 0.27 —
            Beta — 0.03 —
            R 2 — 18.80 —
            Sharpe Ratio — 0.74 0.18
            Standard Deviation — 0.44 0.49
            ICSH: Risk & Volatility Measures
            Trailing Fund Category Index
            Alpha 0.55 0.27 —
            Beta 0.03 0.03 —
            R 2 22.20 18.80 —
            Sharpe Ratio 3.25 0.74 0.18
            Standard Deviation 0.28 0.44
            Out of the 3 funds I believe they are all close in quality, volatility and track record, but I would go with JPST. My issue is that they all yield about 2.30%ish, is the 0.50% extra income worth the chance of your ultra safe “money market” alternative to head lower? Only each investor can answer that question for themselves…
            Compound interest is the eighth wonder of the world. He who understands it, earns it. He who doesn’t, pays it.” – Albert Einstein

            Hope that helps my friend, Nomad

            1. Nomad
              Have you looked at Mint? Pimco is generally expensive but this fund has a good short term yield and the range over the last year has been very narrow which to me means that I will not loose value. Naturally it could have large one day swings. But basically seemed to be a good cash holder. Value your take on the issue. TIA SC

          2. I don’t find much difference between ultra short bond funds with low expenses. Better than MM and I don’t normally hold them long enough to quibble over a few hundredths. Yes they could go down a little but also could go up, though not as much upside as downside. I’ve been using ICSH FLOT and VGSH. Fixed, floating, and treasuries.

              1. I’m not afraid of a little volatility if it could go either way. A small gain is a nice surprise. A small loss is just the cost of doing business.

    2. Fidelity makes a big deal ….and rightfully so…that money is swept into money market accounts.

      If you have 10K in retirement cash, or 100K in non retirement cash, you can buy FZDXX, current yield 1.81%. You cannot use the fund as a sweep, but Fidelity will automatically redeem if needed to cover trades.

      The like fund at Schwab is SWVXX. Current yield 1.77. Cannot be used as sweep (manual purchase)…and important!! …Schwab will NOT redeem automatically to cover trades.

    3. Nomad
      Have you looked at Mint? Pimco is generally expensive but this fund has a good short term yield and the range over the last year has been very narrow which to me means that I will not loose value. Naturally it could have large one day swings. But basically seemed to be a good cash holder. Value your take on the issue. TIA SC

  8. Many thanks for the responses to my wash sale question. I had a feeling that I was barking up a tree that would trigger a wash sale spanking.

    I appreciate the time you all spent setting me straight. My crazy idea did sound too good to be true.

  9. I took her out for BAC-N and COF-I.
    She ended up PRE-G and I got an STT-D.
    I could just PUK-.
    HarHar? JA

  10. Hi all,

    I have a general question regarding the wash sale rule:

    I bought my 1st lot of shares of ALTGF several months ago @ ~18.75.

    I bought a second lot today @ ~ $17.76.

    Can I sell lot #1 **now** and not violate the wash sale rule….and be able to take the loss? In other words, does the 30-day rule apply to the date the sold shares were purchased – regardless of when the second lot was purchased?

    Or….. do I need to wait 30 days from today to sell lot number one?

    TIA!

    1. If you can be sure and specify the 1st lot of shares to sell, you might just be OK. People often get in trouble and you probably know why. They try to sell 1st and then buy again within 30 days. That’s a no-no. But you’ve actually bought in 2 lots and are now selling partial shares. As long as you don’t try to buy any more shares within 30 days, I don’t think the tax man will cometh, but I’m no accountant – so grab your salt shaker.

      “A wash sale occurs when you sell a security at a loss and then purchase that same security or “substantially identical” securities within 30 days (before or after the sale date).”

      1. Then again, Investopedia states the following…. so folks should be careful. It says you have a 60 day window basically, to be concerned about…30 days before and 30 days after… But you said you initially bought several months ago – so that ‘should’ place you out of the 30 days “before” trap.

        “A wash sale occurs when an investor sells or trades a security at a loss, and within 30 days before or after, buys another one that is substantially similar.”

        1. She will run into wash sale rules. You can’t get around it by buying a second lot first then selling the first if you are in the wash sale window. that would be a loophole easily exploited.

          Here is the rule:

          The timeframe for a wash sale is 30 days before to 30 days after the date you sold your shares for a loss. If you own 100 shares of stock and you buy 100 more, then you sell the first 100 shares for a loss 10 days later, the loss will be disallowed for tax purposes.

          https://finance.zacks.com/30-day-rule-buying-selling-stock-2065.html

    2. The good news is that the wash sales will be calculated on your YTD TAX area on your account somewhere. You do not have to do it or ask something like turbotax to work some magic act. The brokerages have come a very far distance from not too long ago in regards to this. Notice I said it is available now for the current year under YTD Tax not statements or gain/loss (although your brokerage statement may define it that way), just dig around.
      The new systems are great otherwise a good Investor Information site is very good and also prob available on a quick search on your brokerage account complete with good examples.
      Mini cop-out by me for not going into the detail. {S wash sale are different for different types of securities. Happy Digging. JA

    3. Amy, unfortunately, you will have to wait.

      I know this first hand because I experienced it a few years ago. My broker reported on the 1099 as a Wash Sale, and adjusted cost basis of the current shares. The good news is that you do NOT forfeit the loss, it gets rolled into the cost basis of whatever shares you have, so at the final sale of those shares – assuming you do NOT buy back until the 30 day window passed – you will be “made whole ” again.

    4. Amy – the wash sale rule is designed to prevent exactly what you are trying to do. Wait the 30 days, then sell the higher basis shares for a loss. Be sure to specify which shares you are selling.

      I hope this part of a tax loss/gain harvesting strategy. It’s the time of year to be doing that.

  11. The update from the Arizona State Board of Accountancy on Rida Morwa/Rida Mroueh is that his license number #8693-E has been expired since 1995 for lack of non-registration. Rida, has added the word “former” to his CPA description and the lady I spoke with asked me to email her the link for Rida’s bio and was checking to see if he needed to include more of a description than the word “former”.
    Nomad

    1. I just spoke with Arizona State/Thunderbird School about Rida’s alleged MBA graduate degree. According to the Registrar’s Office Rida Morwa DOES NOT have any MBA from ANY school that was associated with Arizona State or the Thunderbird School ofGlobal Management. Rida graduated in 1991 with a degree in Master (NOT Master’s) International Management and this WAS NOT converted to ANY MBA and was never converted to an MBA by the Thunderbird School. Rida’s degree is from 1991, was from a school named American Graduate School of International Management. The school eventual became the Thunderbird School and did NOT offer any MBA degree until 2001 long after Rida’s graduation. Rida’s statement that he is an MBA is a falsehood and should be corrected.

      In a time of universal deceit – telling the truth is a revolutionary act.
      George Orwell

      Nomad

      1. wow Nomad.. oh well.. how many services offer Contributors who are anonymous and make claims too.. after 12yrs of using the site, again, grab a ticker and the salt shaker for me (for a few grains) ..

        so funny.. on a personal note, I came to SA from Yahoo finance (‘member when they used to post articles on there back in the day amongst the news releases etc.) in 2008 when I was involved more in precious metal stock trading…

        now I find myself completely over the DGI and income crowds who have all partnered up and pump incessantly the same few companies.. and back with the gold bugs where I find a lot of great new and interesting writers.. something to do for a full time caregiver like me with too much free time on her hands! bests to all..

        1. looks like someone is paying attention.. edits now show this..lol.. oh well enough of this for sure…

          In addition to being a former Certified Public Accountant (“CPA”) from the State of Arizona (License # 8693-E), I hold a BS Degree from Indiana University, Bloomington, and a Masters degree from Thunderbird School of Global Management (Arizona). I am also a Certified Mortgage Advisor CEMAP, a UK certification. I currently serve as a CEO of Aiko Capital Ltd, an investment research company incorporated in the UK. My Research and Articles have been featured on Seeking Alpha, Investing.com, ETFdailynews, and on FXEmpire.

          1. Bea, Rida has not changed this bio http://1hdo.com/about-us
            He may not understand what the real truth actual is. It’s on his conscience and I’m just trying to protect the vulnerable investors that cannot make quality financial decisions for themselves and rely on these “professionals”. Once a “professional” writer tells a lie for so many years that person may at some point start believing the deception and BS…
            Nomad

                1. His bio says, I have been advising both individuals and institutional clients on high-yield investment strategies since 1991. Well I know he was running for student rep in fall 1990 semester. So if he was advising people “load up” on CBL around $8 last year, what kind of high yield crap was he recommending green out of college? Horse buggy factory high yield debt, maybe?

                2. “Let’s get pretentious
                  Put on an act
                  Let’s get portentous
                  Embroider fact
                  Exaggerate it
                  Dress up the bland
                  Let’s overrate it
                  Let the critics be damned”

                  Peter Townsend

      2. That’s some good sleuthing Nomad. So he basically poofed his entire bio. Aside from the money they’re losing their readers, that’s just really disappointing. A whole other level of fakery. All for clicks. Wow.

        Tim, Thank you again.

      3. Ah, it aint the first “mistake” he has ever made. Like when someone asked him if he had a 2018 pick of the year and how did it do…His response was he didnt have one, that year…Except he did…”2018 Reit Pick of they Year”….and it was SKT. No wonder he “forgot” as it was a disaster bomb pick. If you assume every thing he says is not the truth you will never be dissappointed.

    2. BTW, Rida was a CPA in Arizona from February 1994-March 1995; 1 year and 1 month for those keeping score at home…
      Nomad

      1. Good sleuthing Nomad. Now if they had been the slightest bit helpful and accurate you wouldnt have had to went to all the effort.

        1. Grid, thank you for your comment. I truly don’t not understand why ANYONE would want to embellish their background. John D. Rockefeller the founder of Standard Oil and one of the wealthiest men ever was a high school dropout and never lied or ran away from his past. Richard Branson One of the most recognizable billionaires in the world would always tell people the truth and was proud about his humble background, (Now) Sir Richard Branson he struggled with dyslexia and dropped out of school when he was 16. He soon founded his first business, a mail-order record retailer called Student Magazine. That company would become the Virgin Records stores and music label.
          It’s essential to tell the truth at all times. This will reduce life’s pain. Lying distorts reality. All forms of distorted thinking must be corrected.
          John Bradshaw
          Nomad

      2. Good job on this Nomad. And obviously someone there is paying attention to this site given they already made changes based on the facts you reported.

        Now, they won’t be able to make changes in terms of their past front running activities. Maybe they will stop them going forward knowing people are talking about it but if the SEC starts investigating based on a complaint filed, they won’t be able to hide past misdeeds.

  12. Thoughts on Rida …..

    I read the comments about Rida and the HDO gang with amusement and concern. They may well be embellishing on credentials and many here find their investment advice to be bad advice. But where’s the crime?

    Where I think they may be vulnerable is on the issue of front running their recommendations. There is no doubt their buys and sells move the market. I have looked at a number of the charts for their buys and sells and there is a consistent pattern. There is a discernible movement in the price BEFORE the recommendation is made public, even to the paying members of the HDO club.

    Front running is a crime. In a real firm there are very strict rules in place to prevent front running by analysts and others in possession of MNPI. At SA, at HDO, there is nothing.

    The place to take your suspicion would be the SEC or a state’s Attorney General. Maybe a letter to the head of SA (not a post on the website).

    I don’t have the time to do this, especially not this time of year, but I”ll be happy to assist a person who does want to take up the charge.

    1. SA would have to change the Marketplace model cause they all chat/release to members before (if ever) publishing any changes.. again for me it is scan, grab a ticker and do dd. Lets face it folks, it’s marketing pure and simple and nothing more, “buyer beware!”

    1. Grid, I have been buying back in to ailll at 27 over the last few weeks so that’s good news 😊 Do you think they will ever call it? it’s been around a long time.

      1. AILLL has been the largest holding ( qty of shares ) in my portfolio for years. I’m definitely betting that it will not be called for a long time.

        Good to hear the next divy is in the bag, let such times roll on !

      2. Libero, The history is not straightforward as it looks. Those dozen or so Ameren Illinois preferreds are all bastard preferreds from 3 different smaller utilities Ameren bought. (Remember the pitiful outfit Dynegy? Dynegy originally acquired 2 of them and later sold them to Ameren).
        Central Illinois Light Company (“CILCO”) and Illinois Power Company (“Illinois Power”) were folded into Central Illinois Public Service Company (CIPS) and then they were all rolled in together as Ameren Illinois. The $100 par ones you see were all actually $50 preferreds from CILCO and Ill. Power. Ameren cut the share count in half and turned them into $100 pars in 2010.
        AILLL came from CIPS acquisition and was a stand alone issuance. It is actually a $1000 depository preferred so that is why its a $25 issuance and not a $100 one. The Ameren merging of the 3 companies happened in 2010.
        The parent company actually owns many of the shares of the other preferreds. I dont think they own any of AILLL.
        Why a near $20 billion market cap company keeps $100 million of UE and Ameren preferreds outstanding I have never understood. They are all treated through PSC filings as one series and about a collective 4.5% ish par yield. So combined its very cheap capital though largely irrelevant. Why they werent just redeemed at acquisition I have no idea. I do know before acquisitions they were buying the preferreds but not redeeming. There must be some control powers within the preferreds so they wanted to make sure they had voting majority of the preferreds. But why not redeem them all I have no idea, but there must be some reason otherwise they shouldnt exist in the first place being old bastard ones.
        Now the Union Electric preferreds are original issuances from the original company…Union Electric became a holding company, and then later changed name to Ameren. Ameren has two separate subsidiaries, Ameren Mo (Union Electric) and Ameren Illinois.

        1. Griddy,
          I wonder if this is not a situation of the company knowing that a bunch of pensioners own these and that’s why they’re not calling them in. Who really knows, but I’ve seen this be the case in other discussions about other pfd’s or ETD. Or perhaps, these were awarded in some respect to employees like with stock compensation type scenario’s. I’m holding mine till I see a call come, so long live AILLL. Now if only another NI-B would come along we’d all be milking that cow.

          1. A4I, Interesting possible scenarios, but you can definitely add one more pensioner who owns them…Me! 🙂
            I have dug up a lot of interesting tidbits on various preferreds over the years. But outside of knowing holding company were buying them (and received some of the preferreds from Dynegy directly as they acquired many of them in tender offers prior to selling the outfits), I cant get any deeper than that though.

            1. Grid, I’m with you – well, except for being a pensioner. But seriously, ute’s are “my thing” and at any given time over the years, I owned at least a dozen of them all across the USA/Canada/UK. Essentially, having a piece of the primary provider(s) in almost every geographic area. I’ve found that many times, there is a huge ownership by ‘the locals’ and ‘the locals’ are on the boards, they are influencers in the community, politicians with pull, and the employees and contractors for the companies themselves. This is why in varying cases, I’ve found that these old offerings just live on and on and on because these companies are smart enough to not poo where they eat. The UEP and AILLL types are just a few great examples. Makes perfect sense to me, really. It would be cheaper to redeem, especially now in this tape with these low money financing rates. They could call in AILLL and issue a high 4 handle offering and it would be gobbled up. So there are reasons why they are not calling these things. If it was just about capital raising and cashing in/out by the issuer, you’d see action like the one’s who issue short duration convertibles, calls on first calls that happen routinely, etc. It’s all good to me, as i still straddle the fence of common vs pfd/ETD ownership. I happily own the common in names like D, DUK, SO, ED, SRE, NEE which yield nicely and give silly high cap gains (NEE specifically) while juicing the cash flow with the likes of AQNA/AQNB/NI-B/AILLL/DCUE/CNP-B and so on.
              Rant over… 🙂

    1. Does anyone know anything about an ETF CEFS which has only Preferred’s. Its been having close to 8-9 % on distribution?

      1. CEFS holds a basket of Closed End Funds (hence the name). It holds no preferred stocks directly and none of the closed end funds it holds are funds that generally own preferred stocks. The holding are mainly high-yield and floating rate fixed income funds and a few muni bond funds thrown in.

        https://sabaetf.com/holdings

        I own a small amount of it and it currently yields about 8.4%.

        1. If you want to own a basket of some of the highest risk income CEFs, this will do it for you. You’ll also pay 1.1% for the privileged.

  13. Anyone have thoughts on the CHS preferreds? I’ve had my eye on CHSCN for a while and I’m thinking of starting a position.

    1. CHSCN has been very good to me, especially having bought a lot more during the December 2018 swoon. That said, it’s pricey here, but still yielding a very decent rate for a QDI security. Decent amount of call protection… I’ve been looking to add more. I think it’s a winner and with the Chinese allegedly buying up to or ~ 50bb more in ag products with the agreement talked about last week, I think it bodes well for CHSCH, although they do get a lot of their earnings from energy relateds…

      1. Appreciate your thoughts very much. That was part of my thinking on it. CHS has a nice presence here in ND. Agree it’s pricey right now. I sold out of my ALL-H for a nice cap gain a short while ago and wanted to redeploy for a longer term hold.

        1. My only question is WHEN to buy more CHSCN. You could pick an ex-date when it drops in price, you could wait for ‘tax loss selling season’ to maybe bring the price in on pfd’s and ETD’s in general, or any of 5 other possibles. Like I tell others here, my $’s are my employees and I expect them to work for me at all times. So personally, I’ll be adding more CHSCN probably tomorrow when the latest batch of employees (divvies and interest payments) come in.

          1. I did end up buying a bit of that today. Saw CHSCM was down over 1% today, so I added some of that as well.

    2. Put the CHS issues on your shopping list for the next mini crisis. CHSCM was down to almost 22 last December. You made almost 3 years of dividends by buying in December and holding 6 months.

  14. Knowledge is power (as advertised)
    I admit to having lost the most money in 5 years due to Sneaking Alpha recommendations.
    At my age, i should have been more skeptical.
    (I knew better than book on Spirit again, but.. 🙁 …)
    Had i known what you guys had been posting then, it wouldn’t have happened .
    Now , thanks to Tim and you guys, i feel better armed with knowledge.

  15. Its anyone’s guess where rates will be in 30, 90 or 180 days though a Bloomberg article today underscored the blindside we know many fixed income investors will experience if rates were to start rising (perpetuals were among the highlighted exposures).

    The conundrum of the lower rates I think is that as they fall, the risks are not also changing, meaning the risk/reward ratio keeps increasing. We could argue I suppose that IR risk actually increases as rates fall, further exacerbating the problem.

    Though I’ve been a holdout on selling, the gains (advance distributions) are becoming too extreme, the YTCs are now getting too meager and the risk/reward appears increasingly imbalanced. Collecting a year or more’s distributions now, seems a reasonable probability we’ll have acceptable alternatives present themselves within that same time frame. If not, the continued collection of 3 point something % YTC on some holdings seems less and less balanced against the potential 10% hit if rates rise – or some other event like a sudden expansion of credit spreads occurs.

    Nothing dramatic and the course may change, though I’m going to start rolling off or swapping the most extreme (low YTC) holdings as they occur in the weeks and months ahead. Will start of course in the tax-advantaged accounts.

    1. Hi alpha8-
      I find myself in the same situation. In my IRA, my general rule is to sell when YTC is bouncing around the MM rate. However, I am having difficulty in deciding when to sell out of the base of my taxable account. This account is made up totally of IG with qualified dividends as the base. I have been investing in preferreds for less than a year so any sales will be regular income. I’d appreciate any thoughts or comments.

      1. Pete, Rolling up 1-2 years income in 3-4 months via cap gains creates a real conundrum, especially in taxable. Capitalizing on the gain forces a guess on the course of interest rates and depends on one’s risk tolerance.

        I consider a few factors: 1) Income tax rates today are probably the lowest we’ll see in our lifetime 2) The current cap gains are not locked in, they could evaporate tomorrow. 3) A 1%- 1 1/2% premium to MM rates is ridiculously low compensation relative to the risk 4) Many risks are currently muted but could return overnight. They include IR, enterprise and 2020, though a real dark house I believe is credit spreads. And we now also have the uncertainty being stirred up by the fed/repo action.

        A 10% gain on a $25 preferred scrapes off about .50 at a 20% incremental tax rate. Again depending on ones risk tolerance, that 50 cents seems a bargain price to eliminate significant risk and lock in a gain.

        As for alternatives, there are a few term-dated, lower coupon issues trading at/near par or long duration issues trading with acceptable yields. For the longer duration, just need to plan to hold. (KTBA for example) Lastly, cash seems a potential strategic hold waiting for the next “event.”

        1. Thanks for your thoughts alpha8. That definitely gives me a few more things to chew on that I really have not been considering. I tend to forget just how fluid tax rates really are and that the capital gains rate could blow up anytime. I would think tax rates will rise after the next election no matter who is in office. Also, there is definitely risk no matter what security is being held. Hmmmm… maybe sell 50% to 75%. Thanks again!

          1. Pete keep in mind the observations are related to your issues with heavy cap gains and lowest YTCs. I’m rolling over the lowest YTCs just a bit at a time, maybe 1% a week. Trending into any of these decisions allows us to make course corrections as new evidence appears.

            1. Yea, I agree. I’m only looking at the big gainers. I try not to act impulsively and am very conservative. Thanks

        2. Jerry – to extend your point, this is a good time to take losses, too. Losses can be used to offset any gains you make in selling those 2-3% YTC preferred.

          Put it on a spreadsheet and balance gains and losses as closely as you reasonably can. Excess losses can be carried forward. Check last year’s tax return to see if you have any loss carry forwards from previous years. If you use tax software (you should) it’s easy to track.

          And then, if you want to buy the losers back, do so, but just be sure you are beyond the wash sale date. Otherwise, the loss won’t count as a loss for tax purposes.

          Best time to do this tax related selling is right now, mid-October to mid-November. The heaviest tax loss selling and selling for fund repositioning happens in December. A lot of things go on sale then. And there you sit, heavy with cash, ready to buy some bargains.

          1. Bob, Good points and those offsets might have been useful as just sold DUK-A at 27.99.

            Mourning the loss of an IG QID holding, though being a YTC-er, and with the YTC down to 2.94%, appeared we got the beauty out of that one.

    2. As a general guideline, would you ever hold a preferred with a negative ytw with a first call date under a year away?

      1. Thanks for your reply. I don’t have any YTC that low. I missed the lows of last December and many of my holdings are IPO’s. My best example is DUK-A with a current 10.54% gain. YTW 2.81%. So currently I would have to figure taxes on the 10.54% gain as well as loss of the qualified dividend and find an equal replacement for the money. Right now I’m content to hold.

      2. furcal, need more data. If the payout is higher than what you can buy today but low enough that call risk isn’t very high, then it might be worth keeping. Estimating call risk is tricky so some people just avoid these. You don’t have to hold until call date, I might use that kind of issue for a sweeps account until something better comes along.

      3. As a general rule, no. But how negative are we talking? The number I would be looking at is stripped price. How far above redemption price are we talking? If it’s a small amount ride it out and hope there is no call. If it’s a big number, get out. Unless there is a cognizable reason why the issue won’t be called.

  16. Could someone tell me if a Trust Preferred is safer or riskier than a standard preferred?
    Thank you

    1. A trust preferred is just the debt held through a third party. Usually a bank. US Bank was a trustee to a lot of these back in the day. They arent as prevalent now because of tax code changes with bank debt laws. They are segregated from the third party finances so they should be as safe as actual debt is. Unless someone stole them from the trustee, lol.

        1. Your welcome, Jeff. There are various variations of these but ultimately the safety is measured by the actual debt issuance held in the trust. The trust itself is never part of the rating as it is largely inconsequential in terms of the safety of ownership. Some of these types of issuances are actually 3rd party trusts. Where some other unrelated entity such as a brokerage buys the bonds and puts them in trust.
          But then they are sliced and diced into $25 issuances of “certificates”. You technically dont own the debt in trust. But instead you own a certificate that lays claim to $25 portions of the bond held in trust.

          1. from a practical standpoint, a trust preferred is essentially just a repackaged security, regardless if done by a bank or by the issuer themselves.
            probably more than 80% of trust preferreds are 1000.00 bonds repackaged as baby bonds in $25 pieces.
            but there are also other ones, like $100,000 preferred stock repackaged in 25.00 pieces.
            one rare distinction is that the bond trades with accrued interest, but the trust preferred will trade flat.

    2. I’ve made good money trading TRuPS because of the wide spread, sudden price movements, and arbitrage opportunities. You have to be patient because they are low volume.
      The risk is mostly their complexity and some untested legal ground. There was a case where a trust preferred was liquidated for 56 cents on the dollar after the bank was acquired. They claimed mark-to-market allows them to steal that money and the courts agreed. That’s why there now clauses about change of control in the prospectuses.

      1. Martin, you had to bring in complexity, lol..There are many types of trust preferreds. Also, there are a few synthetic adjustable trust preferreds around still that also had the potential problem you stated if the underlying bonds were ever able to be called. And then these would cause a huge problem with the counter party swaps that make it an artificial adjustable rate preferred.

  17. The plot thickens…
    Pendy sent me Rida’s post when he gave his Arizona CPA license number; this is my response:
    BTW, the State of Arizona CPA certified number Rida states on his description and you just sent me a link to is NOT Rida’s
    Certificate # Issued Last Name First Name Middle Suffix Status Status as of Renewal Date City State Country Orders
    9693 02/12/1996 HORN SANDRA M. Active 02/22/1996 8/2020 Mesa AZ

      1. Pendy sent me a link where Rida posted his alleged Arizona CPA license number: (scroll to the bottom)
        https://www.1hdo.com/about-us
        I ran the license number and it came up as:
        Certificate # Issued Last Name First Name Middle Suffix Status Status as of Renewal Date City State Country Orders
        9693 02/12/1996 HORN SANDRA M. Active 02/22/1996 8/2020 Mesa AZ

      2. Pendy sent me a link where Rida posted his alleged Arizona CPA license number: (scroll to the bottom)
        https://www.1hdo.com/about-us
        I ran the license number and it came up as someone else:
        Certificate # Issued Last Name First Name Middle Suffix Status Status as of Renewal Date City State Country Orders
        9693 02/12/1996 HORN SANDRA M. Active 02/22/1996 8/2020 Mesa AZ

        1. Hi Nomad, you are typing in the wrong number.

          The bottom of the page from the link that you posted above states:

          He is a former CPA from Arizona (License number 8693-E).

          You are typing in 9693, not 8693.

            1. Hi Nomad,

              I have not done any searching but I wanted to make sure that the correct number was being used.

            2. Two thoughts.
              1. The -e is odd for a license #.
              2. And if his license expired prior to 2009, it would have been dropped from the system.
              I am a lawyer licensed in 2 states and they do the same thing with long inactive numbers.
              So there is no way to tell if he is lying or not on his bio, since he doesn’t claim to be currently certified.

              1. Justin, thank you for your reply. When I called the state of Arizona CPA Certification office their representative told me that their database would show EVERY CPA EVER certified in their state. I did not have the license number that Rida posted on his bio then (8693), but spelled both of Rida’s last names for them (US and Lebanese) and there was nothing in their database. I will be calling Tuesday to give them the license number and report back to everyone.
                Stay Tuned, Nomad

  18. I just posted this on SA and of course it was deleted; I am only “seeking” absolute truth:
    Rida my friend, is it too much to ask for you to clarify your Arizona CPA designation as I called the State of Arizona office of Certified Public Accounts and had them search both spellings of your last name; they said “there has NEVER been a certified accountant by that name registered in our state”. 602-364-0804 and are you are you the same person as a Lebanese accountant named Rida Issam Mroueh for Audi Bank off of Bab Idris Street in Beirut?
    Thank you in advance for your kindness in answering my inquire, Nomad

    Truth is like the sun. You can shut it out for a time, but it ain’t goin’ away. Elvis

    1. Nomad’s post was on article entitled “These 7.8% Yield Preferreds From Colony Capital Are Ready To Rip Higher” All comments regarding the subject brought up have been cleansed as if they never existed

      1. Did you get to read them all 2WR? First only a select few were deleted like the telling info that several researched AZ records and could not find either name as a registered CPA. Pendy responded with non answers to questions. Clearly was clueless or obfuscating his origin as we directly found the link to his origin that somehow Pendy didnt know. The .edu link was provided…Ya had to dig, lol.. And then the entire thing disappeared. No malice was expressed, just polite info and questions being dispensed.

        1. Pendy just personal messaged me on SA and this was my response:
          am only “seeking“ the absolute truth and NO ONE should run from their past if there is nothing nefarious or of issue. Deleting my inquiries on SA will not be a benefit to anyone unless there is something that someone is distancing themselves from. I will be calling Tuesday to verify this information. Yesterday, I called the State of Arizona Office of CPA designation and they ran both of the spellings of his last name (US and Lebanese) and neither was in their database. The Office of CPA Licenses even was kind enough to search for 15 minutes other name spellings that was close to both his US and Lebanese names and found nothing to indicate he was a CPA in their state. I am going to pay to get his records from the Thunderbird School as well.
          Truth is like the sun. You can shut it out for a time, but it ain’t goin’ away. Elvis
          Nomad

        2. Grid – You never get to know what you didn’t see so it’s tough to say if I saw them all, but I did see Nomad’s original and your follow-up. Pendy’s a master of obfuscation and his answers were obviously that, which is why I posted “Yes” or “no” would be acceptable answers. Sure I’,m aware of what time does to appearances, but it was a BIG LEAP to think that picture you found in the article you linked was him… It was a whole lot easier to believe the pic Nomad founc from Lebanon was .

          1. 2WR, Actually I think that is more of a link and not in a nefarious way…And it actually confirms he went to the school he stated he went to. If you notice, the .edu link, that is a special education protected website, so its 100% legitimate. It just confirms he was from Lebanon as he wrote it himself as such. And there is nothing wrong with that either. The basis of that was confirming what P wouldnt; that he came from Lebanon which means that other name could have been his original name. That actually proves he was a CPA in Lebanon, which is great. The problem was he was blocking that connection for some reason, and no one can confirm the AZ license. P first stated it was “too long ago” (that got deleted), that was an embarrassing answer to give to a 1st grader inquiring. And now this.
            Of course just be honest about everything and then no one gives a crap if its up and up. I think Brad can be very shifty in his recommendations and how he presents everything. But he certainly is 100% honest with who he is. Though that could mostly be for his ego as he is the ultimate “name dropper” on everything he associates himself with.

            1. Pendynut is has proven himself chronically and severely morally challenged and obviously dim-witted, while Rida has been exposed as a fake and phony and many of us are convinced they’re running a pump and dump scheme.

              SA’s constant deletion of our respectful but pointed comments evidences them as obfuscatory, therefore part of what appears to be ongoing criminal activity.

              Rida is smart enough to domicile himself offshore, probably in Lebanon. Seems the SEC would have jurisdiction over the rest. I’d sure like to see them request transactional records from them, their associates, family and friends. That would include records of SA editors.

              I posted a note in that article yesterday directly to “SA Editors” that referenced the deletion of hundreds of respectful truth-based comments over the past many months and asking what they were going to do about the new revelations. It was the first comment deleted.

              Seems it’s time for this case to be elevated to a criminal or regulatory agency.

          2. when you googl Aiko Capital a Rida company I guess?.. this comes up.. lol..
            https://suite.endole.co.uk/insight/company/11646824-aiko-capital-ltd

            what a tangled web woven… and how do they have an outside website, 1hdo Nomadic linked above.. which doesn’t link to SA, is SA getting paid when people subscribe via that link they sent Nomadicmist??

            unless posts are vulgar/obscenity laden ( and even these don’t get deleted anymore) they really should not be delelting them but of course they arbitrarily apply their rules over there when $$ are at risk for the site..

            I was very fond of (and still respect his analysis) Trapping Value who was great when he came on the SA scene in 2017.. then he joined The Fortune Teller.. and that fell thru, divorced in May ’19.. he was solicited by many svcs to join.. told me he picked Rida’s bunch.. he had MUTED pendy for the inane back and forth that went on when TV wrote.. TV calls him quint lizard in TV’s bio even ( still!) … but money talks I guess and now they are all part of hdo.. they always make pendy co-author a released article trying to mentor him apparently to be “better” .. lol..

            Beyond Saving and Trapping Value do good work imo in that bunch, the rest I ignore.. SA is becoming like motley fool, nothing against mfool.. to be honest, other than grabbing a ticker for my dd, I just don’t bother commenting as much as i used to for sure.. we all seem to do deep dd, something sadly I doubt newbies forget to do and take these articles for good advice! oh well, had to chime in.. I am still not over TV joining that service I guess…

            1. Funny you say that Bea. I was recently told by someone I suspect is in the know, that SA gets a 25% cut of subscriber fees. So any he could sign up outside the site means more profit for him. He also said the “trending articles” is a shame. Authors can pay to have their article moved up into that list to generate interest. Looks like everybody is making a buck somehow…except Tim, lol..

              1. Grid, I put back in Rida’s alleged Arizona CPA license number 8693 he states on the bottom of his own description
                https://www.1hdo.com/about-us
                I put back in Rida’s alleged CPA Arizona license number 8693:

                https://www.azaccountancy.gov/CPADirectory/LicenseeDirectory.aspx?category=qUz0M0e8k11HsCztZAjs5BWErop235XXq6ZE76MVLNU%3d&search=Wfr5m%2bh5w9rmeKx1K3o9Pg%3d%3d

                Search results as of 10/12/2019 7:27:17 PM
                for Individuals:
                Category =
                Criteria = Tip: You can re-sort this list by
                clicking on column headings.

                Status Definitions Arizona’s landscape
                Snow Capped Black Hills Mountains Prescott Arizona
                Directory Parameters
                A “registrant” means any certified public accountant (CPA) or CPA firm. This directory only lists registrants that the Board is currently regulating or has regulated in the last ten years. Please read the Status Definition link above to learn which statuses are regulated and which are not. Individuals and firms are separately regulated so a search of both, if applicable, is more complete. To inquire about registrants that have not been regulated in over ten years please call our office at (602) 364-0804 or send an email to agency email: info@azaccountancy.gov . Registrants may practice in states other than Arizona and CPA Verify may be an additional resource.

                Column Interpretations
                Issued – This is the original date the certificate was issued and does not reflect continuous licensure in Arizona for those registrants who have canceled, expired, relinquished or been revoked and later returned as a regulated CPA.
                Name / Address – Registrants are listed by their individual or firm name (not necessarily legal name) as they are currently registered with the Board. A registrant must notify the Board of any change in name or address of record which could be either residential or business within 30 days.
                Status / Status as of – The Status is the registrant’s current standing with the Board effective since the “Status as of” date and does not reflect any board actions prior to that date. For instance, a currently held “active” type of certificate/registration may have been on “probation” or “suspension” previously.
                Renewal Date – If the entry has a date, the CPA’s certificate needs to be renewed by 5:00 p.m. on the last business day of the month and year shown. A postmark is not evidence of timely filing. If the entry is N/A, it is because the individual is no longer regulated. If the entry displays Call 602.364.0804, it is because the Board’s database lacks the requisite information to automatically compute the renewal date and manual review and analysis is required.
                Orders – If a registrant has been subject to disciplinary action, except for suspension for non-registration, the column represents the number of disciplinary orders since 2001. By selecting the number, the disciplinary order with the findings of fact, conclusions of law, and order requirements may be viewed.
                Certificate # 8693 Issued Last Name First Name Middle Suffix Status Status as of Renewal Date City State Country Orders
                No records to display.

                Contact Us| Privacy Policy| Accessibility Policy| Log In| © 2009 – 2019 Board of Accountancy

                1. Nomad, maybe he was one of those garden variety GPA bottom of the barrel types and couldnt muster enough cranial firepower at test time to pass the exam. And maybe Lebanon had a remedial test he could pass so he went home? That is my best guess….Well other than he partied like a rock star at the school and maybe flunked out, lol.

                  1. Grid, one cannot publicly state that they are a licensed CERTIFIED Public Accountant in Arizona, show their license number and then not have taken and passed the CPA test (that is committing a fraud). So far, my research (and others that have reached out to me) show that there NEVER was a Rida Morwa or his Lebanese name Rida Issam Mroueh for Audi Bank off of Bab Idris Street in Beirut, Lebanon that was ever a CERTIFIED CPA in Arizona as Rida states his license number in his bio (scroll toward the bottom) https://www.1hdo.com/about-us I am not passing ANY judgement as I am still doing my deep due diligence/research and am also going to pay to get his alleged degree/MBA transcript from the Thunderbird school in Arizona. I will be reporting back my findings and encourage others that are interested to do so as well. Please do not come to any conclusion(s) without fully doing the deep research and finding the facts. As I’m sure none of us want to convict an innocent man…
                    “Never be afraid to raise your voice for honesty and truth and compassion against injustice and lying and greed. If people all over the world would do this, it would change the earth.”
                    William Faulkner

                    1. He very well could be properly certified. And maybe the problem is his barking dog messenger boy. That guy could screw up fixing a cold glass of milk to drink.

                  2. Grid

                    Speaking from personal experience (I have a CPA license, currently inactive) – it is a fraud to pass yourself off as a CPA without having an active license. So even if he somehow passed the CPA exam and hours requirement at one time, he would still need to maintain an active license to use the CPA designation with his name.

                    If he was licensed at one time. he could say he was licensed as a CPA, currently on inactive status – or something like

                    Rida Moron, CPA (inactive)

                    1. That said, looking at the HDO description he does couch it saying he is a former CPA. So he can legitimately state that since he does state “former” (assuming of course that he actually was a former CPA – and the state licensing board could verify that)

                    2. Maverick, it will be interesting to see what Nomad finds. I noticed his presumed alias in Lebanon had what you mentioned…It stated “non practicing member”.

                    3. Maverick61, thank you so much for sharing your knowledgeable post with all of us. When I called the state of Arizona Office of CPA Certification I had them run both spellings of Rida’s last name (US and Lebanese) Morwa or Rida Issam Mroueh that was formerly with Audi Bank in Beirut, Lebanon and neither was EVER a CPA in Arizona. Now that Rida has published his CPA Arizona number 9693, I will again call Tuesday and see what turns up. When I put CPA license #9693 into the search web site NOTHING comes up as there is no one that is a CPA in Arizona with that license number https://www.azaccountancy.gov/CPADirectory/CPASearch.aspx

                      Voltaire said “ Cherish those who seek the truth but beware of those who find it.”
                      Take care my friend and be good to each other, Nomad
                      Seeking the absolute truth is but the most noble endeavors…

                2. Conspiracy theory I’ll toss out there…. “License number 8693-E” is what he posts. Maybe the “E” in that denotes “expired”, and the number actually was his quite some time ago, but after expiring, it was reissued to Sandra Horn – which is why her name comes up in the current search? The AZ site says that you need to call for inquiries older than 10yrs I think, so I guess Nomad will get to the bottom of it.

                  1. Hi Nomad,

                    Note that in one of your earlier posts you state that the license number is 8693. Then later on you state 9693, twice, so I’m not sure if it’s a typo or not. Just make sure you’re using the correct number.

              2. Gridbird–I submitted an article a month or two ago which they rejected–guess I’m not pumping something hard enough (or at all).

                1. Tim, really? You see what haphazard junk articles are written on their site and they reject your article? You have written there before too. Maybe they are treating you as the enemy now. 🙂

                  1. wow.. just wow. They have these kids with chemistry or english degrees writing financial articles w massive inaccuracies (one recently charted Canadian oil companies–generally measured in cash flow/FFO- against Macerich, a REIT, again usually measured in FFO or AFFO- in a PE chart of all things calling MAC an oil and saying how high the PE’s were!) .. it is truly a wild ride over there lately..

  19. I normally don’t trade much. Being retired i tend to stick to preferred and baby bonds for income. A year and a half ago, i stumbled onto prudential and have flipped five 100 share lots. I also managed to pick up five quarterly dividends along the way for a total profit of just over $2700. Fun to do with a stock that you don’t mind getting “stuck” with.

  20. Keep those canaries flying . . .

    By James Grant for Barron’s
    10/10/2019
    Now that even Greece is borrowing at subzero yields, the notorious, elevated U.S. dollar repo rates of mid-September—briefly as high as 10%— look less like interest rates than typos. Is there a monetary screw loose?
    The upside lurch in the cost of borrowing against prime government collateral has caused Wall Street to exclaim, “And how!” The cry has accordingly gone out for the Federal Reserve to institute a permanent fund with which to tamp down the interest rate on repurchase agreements. About a quarter-trillion dollars should do the trick, expert opinion holds.
    There’s too little liquidity, the special pleaders go on—too few dollars with which to warehouse newly issued government securities until that paper can find a nice stable home. You’d expect that repo rates pitched at such a big premium to Treasury bill yields could pull funds from the moon, but postcrisis financial regulations stay the hand of many a would-be bank lender. Then, too, the argument goes, better to spend billions on prevention than trillions on a cure: Disorder in the market for overnight secured lending could wreak havoc on Main Street, as well as at the corner of Broad and Wall.
    In this context, I recall the old story about the truck driver who stops every few miles to bang on the side of his rig with a sledgehammer. A cop asks him what he’s doing. “This is a 40-ton truck,” the driver says, “but I’m carrying 41 tons of canaries. Got to keep them flying.”
    So maybe the trouble lies not with the adequacy of the funds available for repo financing but with the sheer weight of the debt to be financed. As a condition of being designated “primary dealers,” the Fed’s two-dozen market-making firms must enter good-faith bids for every Treasury auction. This year, they’re carrying $200 billion or more of securities in inventory, double the levels from 2016 through early 2018. Maybe the dealers need a hammer.

  21. Fido stopped charging commissions on trades in the last day or two and as a result I have had a number of nibbles on my good til cancelled orders. A couple of executions on 3 shares out of 625 order, 66 shares on 500 shares, etc. The no commission takes the sting out but I think we may see more of these odd lot trades which makes my tracking more cumbersome.

  22. For the technicians out there.
    I am charting the *TNX Ten year treasury note presently at 1.745.
    It’s looking a bit menacing for fixed income investors.
    It is above the 20 dma and the 50 dma.
    Next is the 100 dma at 1.865
    The 100 dma was last breached during the the December to remember.
    Watching if 1.90 holds or not before i commit more$ to Preferreds.
    My opinion is, it will be a short term shakeout and *TNX will resume its dominant direction downward.

  23. The Tweet Markets – Is it just me or do others feel it’s impossible to feel comfortable making decisions in a market capable of being up 400 points on the basis of tweets emanating from Hyperbole Central? And no, this is not meant to be a political comment.

    1. Mehhhh………..

      Nothing is going to happen for any material gain
      because nothing will get through congress

      so I am making decisions based on that
      I have tuned out all the noise and stopped watching markets on a daily basis

      making the best of the good weather as golf season is almost done in the north east

      1. Any China deal doesn’t need to be approved by congress – thankfully I might add or nothing would get done

  24. Oh my – just read another gem from the HDO / Rida Moron crowd

    In their current article on MAC (which they have touted several times previously at higher prices) Rida’s lapdog Pendragon responded to someone who basically pointed that out (If I look at the trend of the share price over the last 3 years the trend has been consistent and negative. Starting at~$77 and now at ~$27.) with this gem

    “Given the conditions in this sector, ANY REIT that hasn’t seen a share price decline over the last 3 years would be over-valued and thus not a good purchase at this time”

    unreal. Normally I just laugh at the foolish stuff Rida and his band of thieves post but had to share this one because it was so ridiculous

    1. Having backed up the truck on CBL for what seemed like a couple of years, they are in need of another table-pounding issue.

    2. Maverick61–you got to make the big calls to draw the clicks in. While I am not rooting for a bear market I will be watching with baited breath as stocks of all sorts fall 20%–we’ll then separate the boys from the men–or the girls from the women.

      1. Tim – What are you saying, that there are only two sexes? What about the 51 additional possibilities at last count? What are you a biased altsexophobe or something? lol

    3. Mav, They are just so ridiculous. You can go after them in the comments, but if you start making sense – they’ll simply have your comments deleted. Pendylizard was drooling on himself one day at the (considerable) expense of newbies so, like others here have done, I very respectfully eviscerated him. His running defense is to simply delete all the comments.

      This latest comment from them you posted is hard to fully absorb. Just astounding. My guess is they front run their book via SA.

      1. Alpha, you know damn well they do. If they mislead and obfuscate with their comments it takes no imagination to assume your thought.
        And as far as deleting comments go. You notice they always say they cant delete comments themselves? But do you also notice they never said they didnt ask to get them deleted which is what they do. Mislead and obfuscate….

        1. Alpha and Grid – yep, you are both spot on. it’s sad to see unsuspecting people falling for their spiel

        2. Oh, and just checked – they already deleted 3 comments I made nicely pointing out that they “forgot” to point out the higher prices they previously recommended this issue at and the losses from those dates

          1. Just checking, but you guys know that not only are they allowed to delete comments on their articles but you’re also having SA pay them at least a penny each time you even go to the article, even if you don’t post anything?

            1. A4I, Pendy and Bradley have deserved the pennies I have given them for verbal beat downs I have put on them….Until they get deleted, lol. I dont know if its still this way but a year or two ago a writer mentioned they didnt get the penny from mobile looks though. And since most people dont know how to use outline.com they wont get pennies after 10 days, lol.
              Brad has mentioned he may get around $60 an article. I believe that more than I do his SKT reco from $30 ish on down daily, lol.

              1. Grid, while I find some of the articles on SA entertaining, I’ve come to the final conclusion that most of the “experts” there are unable to find real jobs in the private sector so they are now trying to hawk their “newsletters” at about $500+ per year to make a living. Brad has touted the returns from his model portfolios over the past numbers of years – but then when I asked him if Morningstar had verified the returns there was no response. lol

                Rida was touting thermal coal stock ARLP when it was $2 higher per share recently and Pen was there defending the company and future prospects. In a rare admission by him, I asked how many shares of the company he owned. The answer was Zero shares.

                1. Oh, I agree, Lou. Did you check your PM I sent you on where Moron really came from? Of course none of that is mentioned in his bio.
                  And Brad? He is the greatest investor ever. He has touted SKT 43 times since SKT was near $30 a couple years ago, and yet according to a recent post is barely down on his account in owning it. That is one amazing investor!

                  1. Grid, I didn’t have any new PM in my inbox – but would certainly be interested in the background on him. And yes, SKT has been featured many times as a “SWAN” stock, only to see if fall time and time again over the past few years. A lot of investors have lost money on that recommendation.

              2. $60 an article is ridiculous. No way that’s true IMHO with the followers he has and how many times most people will go back and back and back to participate in the comment streams. But whatever… I can only speak for myself in that since I quit listening to Cramer on CNBC many years ago, stopped all subscriptions to everything except Kiplinger’s rag, and almost entirely stopped dealing with SA – my ROI has gone thru the roof. Old fashioned due diligence will win every single time over listening to the arm waving Sander’s type talking heads and the article-of-the-day crowd like Bradley and the Moron crew.

  25. the proliferation in EU banks ( Germany, Switzerland, Italy) charging large clients (over 100k bal) to hold their cash is wild.. we should all get together and build a better mattress.. it certainly lends itself to holding gold to store value.. and of course high quality instruments or real assets w ever low rates.. (or spending it!! inflation??!!)

    I am not in the lower for longer camp for rates because of deficits, money printing.. but intermediate term it sure seems like this will be the case., especially w demographics in developed countries looking to earn. Dam the savers again.. sad…

    1. If there is anyone out there that want to pay me to hold their cash for them, please let me know.

      I am more secure than the EU banks but charge no more.

    2. Seriously Bea, sales of safes must be high in those areas. And in lieu of a negative yield, seems a good guess a lot of medium and LT debt is being paid off.

  26. Is it my imagination or are the temporary tickers being abandoned more quickly to the permanent ticker symbols lately? It was only a couple days with GOOD and Urstadt issues I already flipped. And now the new BRiley preferred has already changed to permanent RILYP after one real day of trading.

      1. Odd isnt it. Maybe the shares arent getting dispersed as quickly? I dunno…Was gonna play flipping game with new Gladstone BDC issue but paltry yield probably will preclude me from.

      2. It has now been 10 days since DLRTP started trading and still no permanent ticker.

        Perhaps they have not applied to the NYSE.

          1. So I will finally have my chance to flip the shares bought on first day of trading.

            To flush it out I put in a well out of the money trade that gets cancelled the night before the ticker change.

  27. For those not adverse to picking up pennies at little risk, note that NTRSP just paid its most recent divy last week.

    We are now guaranteed the next divy payable on 1/1/2020, since the prospectus states that NTRSP can only be called away on a payment date.

    If NTRSP is bought today at $25.35, one guarantees a cap gain of $0.015. Yep, I know – peanuts ( maybe less than that, just the shell )

    I am watching for it to go to $25.32, when I will buy in a IRA or ROTH. Just a few pennies, but with free trades, I am not going to turn up my nose at even such paltry sums.

    1. GLOG-A has a first call in April 2020, with a negative ytw. I would anticipate they will try to replace it, but appreciate any opinions.

  28. Good morning all. I am holding a large position in NSS (currently callable). I like the credit (you may disagree) but I am concerned about the call risk. I could swap it with NS-C which is not callable until 12/15/22 but I obviously prefer the baby bond vs the Preferred. NSS has a provision that allows NS to defer interest payments for up to 5 years. While I don’t like it – it does give NS flexibility which may make them less likely to call it. On the other hand with interest rates lower now and headed lower it seems, the current 9.4% floating rate looks expensive. At Ba2 perhaps they can issue something closer to 8%. Not sure. Lots of variables here, would appreciate all coments. Thanks

    1. Gary, the reality of the situation is this. NSS is a preferred. The debt title means almost nothing in terms of protection due to deferral and subordination. Fitch projected a 0%-10% recovery rate of NSS if NS ever went into receivership. So dont think that the debt title gives you protection.
      Now, it does create an “illusion” of safety which the stock price reflects during volatility over the sister preferreds.
      Personally, I used NSS as a trader but then it jumped and hasnt dropped so I gave up, not willing to own or buy at $26. Being that the case, I did buy a few months ago NS-C in the $23’s. I feel comfortable owning a small amount long term but would never overload.
      The company is a non stop serial negative cash flow machine. Outside of utilities where it basically doesnt matter, that always gives me pause. Plus the fact this company never quite hits its projections no matter how often they make them.
      That being said, what you really are asking for is not company advise but opinion on moving from NSS to preferreds. All I can say is I did exactly what you are questioning because of the call risk you mention. Knowing most likely they both are worth 0 if insolvency occurs mitigates the concern of dropping a cap stack notch, lol.

      1. Thanks Gridbird,
        Good comments. Yes the illusion of more security makes NSS less volatile but otherwise the same if they go BK. I just do not see that for a $3B+ market cap company that is currently paying $250M+ in dividends and rated Ba2 by Moody’s but as you know we all have different levels of risk tolerance. Thanks for the feedback.

        1. Your welcome Gary. Yes, I agree there is certainly no risk near term of issue being endangered from insolvency. Bob, may very well be correct about NSS having little redemption risk near term. They do get a tax deduction on this, and Libor could be in a dropping pattern and the yield cost of this issue can continue to drop.
          The company is just too complicated for small brained me to completely understand. There is a huge disparity in yield between their actual bonds and their preferreds. Considerably more than most. I just lean on credit analysis, big picture… Big debt load, cash flow negative, mitigated by growing revenues, and hard assets that many are desirable.

          1. Grid – As you say, there’s a huge disparity in yield between their “actual” bonds and their preferreds. I think what might need clarification for the benefit of some regarding NSS is that it’s it SUBORDINATED status as a note/bond that makes it essentially equivalent in credit quality to the preferreds. There IS a difference in quality between NS’s “actual” bonds and the preferreds but there is essentially none between it SUBORDINATED bonds and the preferreds.

            1. Yes, 2WR, I agree. I mentioned in above post it basically is a preferred. And in fact its creditors are waiving NSS to treat it as a preferred and not debt to keep their covenants unmolested and out of trouble.
              There is nothing wrong with subordinated debt inherently. I own them frequently. But I sense through readings over time, there is some type of misunderstood protections with them over preferreds. I wouldnt hang my hat on that in times of trouble. One has to understand when a company gets stressed what happens. I have mentioned the process often and wont again, but in reality they usually would wind up toast with the preferreds. There is a reason why FINRA many times lists these subordinate debt issues as “Preferred Securities”.

    2. I concur with grid that there is no substantive difference in credit quality between the bond and the preferred.

      My overall sense is opposite to yours; I have little concern about a call but a substantial concern about credit quality. Their financial position makes a call difficult. This a a very debt-laden company, and if the economy tanked the nature of the company’s business would get them in trouble quickly.

      I used to hold several thousand shares of NSS but trimmed it to 400 many months ago. That’s the limit of my holding level for Skank-rated shares .

      S&P has a single B recent rating on a NS debt issue. NSS being a subordinated note should (I believe) rank lower.

      1. Thanks for the reply Bob.
        I disagree with your “skank-rated-shares” comment, LOL but I do understand. We all have different views of credit risk. Ba2 from Moody’s is solid IMO. Also, I use the Kamakura Risk system which gives NS an implied BB+ rating from their perspective and a 0.28% probability of default in the next 12 months and 3.79% probability for 5 years. In comparison, PSEC, has a 0.50% default risk for 1 year and 6.01% for 5 years. Still, appreciate your comments. Always good to hear other perspectives. Thanks

          1. Bob,
            You can find more details here
            https://www.kris-online.com/
            The annual fee is $1200 per year. I am happy to talk with you and/or start an email dialog to provide more info.
            I started using Kamakura via their Bond Investor service on Seeking Alpha
            https://seekingalpha.com/author/donald-van-deventer/research
            and then migrated to KRIS after I learned more about how their rating system works. Just to be clear – I receive no compensation of any type from Kamakura. I’ve been in fixed income for 25+ years, retired 8 years ago and like most of you (I think) am just looking for whatever “edge” I can get to keep my income stream flowing with as little risk as necessary.
            Gary
            gary.w.hargreaves@gmail.com

    3. Gary, now remember the Ba2 represents the Senior Unsecured. There is no way they would redeem the subordinate note and shove it higher up in cap stack. They are pressed to their credit limits pretty much up there, but I do think they got the revolver line cleaned up.
      The only way they would redeem is with another similar subordinate debt issuance. Last I read debt covenants are allowing this issuance to be treated as a preferred since it sits below them. They dont want any unneeded debt shoved from lower to higher cap stack while presently running cash flow negative.

      1. Gridbird,
        Yes I am familiar with the Notching methodology / practice by the rating agencies. As you know it is all about the projected difference in losses across different types of debt in the event of default. My approach to credit evaluation is to look at the Corporate / Parent LT Rating as the primary indicator of credit worthiness. Firstly, I think the Agency Ratings are very poor indicators of actual default risk. They are usually way behind the default reality of any given company. This is the primary reason I started using Kamakura (see my other comments to Bob). I only use them as a point of reference for comparison along with Kamakura and of course the typical balance sheet , cash flow, etc metrics and industry trends, etc. I hope / intend to only invest in companies that have little chance of BK for the duration of the debt I am holding. I don’t really care about the notch ratings but I do understand them.

        1. Gary, Im of the persuasion there is no good or bad purchase as long as it meets ones goals and understandings. As mentioned I own some NS-C myself. I tend to speak in the negative to make sure one knows the risks.
          I personally am not worried near term, these HY issues though are more exposed to outside events such as HY credit lockups. Even if materially unaffected company wise they get sucked more violently into the stock price downdraft though. But as we know, waiting on that 9% 5 year term dated Microsoft preferred will be a fruitless endeavor, ha.

      2. NSS occupies a narrow spot in the NS capital structure. There is a lot of senior debt and a lot of preferred equity. NSS is a sliver sitting between the two and not due for decades. That, plus the company’s tight finances, make it an unlikely candidate for redemption.

        Or at least that’s what I concluded when I had a good look at it months ago.

        For me, this is an issue I would only hold in a Roth, which is scarce real estate. Form a risk management perspective I could not justify such a concentrated position in such an issue. It’s grand kids’ money after all.

        1. Bob, I personally try to keep my HSA and Roth money clean from too much risk. My taxable can always grow due to the fact my pension is way more than my monthly needs.
          But, I had to suck it up and put GLP-A and NS-C in it for obvious tax reasons. And I bought that BRYIL junker to try a fast flip for tax free gain. Once I get that dubious trade over with, I will find a more suitable more conservative play…I hope anyways.

    4. About that deferral feature.
      IIRC, about 10-12 invoked it in the last recession, and how many resumed payments, and didn’t file bankruptcy protection?
      2 that I can remember off the top of my head.

      1. Old Second Capital
      2. Hillman Preferred.

      That’s it.
      A deferral is a death sentence in most cases.
      (though if you monitor the ones that defer, you can make a boatload if they ever resume and are quick off the draw)

      1. Justin, “Quick off the draw” is definitely correct. Old Second Bank went way over par well before it resumed paying as people knew it would resume paying….But make no doubt about why it did…It would have been not been on your list of 2 if the Feds didnt buy preferred stock in company and then dumped them at low prices. Long story short the bank recapitalized off the back of the Feds. If it had been left to its own devices Old Second Bank would have went totally belly up and OSBCP would have went to $0.00.

        1. Thanks Justin and Gridbird
          Interesting info and yes hopefully all of us would exit our positions well before they had to suspend payments.

          1. Easier said than done. The deferral isn’t announced until the declaration date, which is months after the last payment and can be when the stock is trading close to par. It then can drop 50/70% in the blink of an eye.

    5. Gary, I’d advise a close look at the prospectus of NS-C before switching over from NSS. I think you’ll find there ARE substantial differences not mentioned in the other comments. For one thing NSS interest payments are not subject to suspension or reduction for any reason short of default. NSS may not be senior debt as others have pointed out, but it is debt just the same. There are many scenarios short of bankruptcy where NS-C shareholders will be required to carry the financial burden so the company can meet its debt obligations. While I agree with the premise that Nustar is far from a distressed situation, I sleep better knowing I hold debt and not equity in the company.

      1. Citidel, just to clarify, I certainly dont dispute it sits above on cap stack. But if the company is a sinking ship its basically just sitting on top of the person drowning first. Unless I missed something deep in fine print you are not correct on not being able to suspend short of default…They can..Per prospectus..
        We may elect to defer payment of all or part of the current and accrued interest otherwise due on the Notes from time to time, for one or more periods (each, an “Optional Deferral Period”) of up to five consecutive years per Optional Deferral Period. However, we may not optionally defer interest payments on or after the maturity date or any earlier date of redemption in full of the Notes.

        Deferred interest not paid on an interest payment date will, to the extent permitted by applicable law, bear interest from that interest payment date until paid at the then prevailing interest rate on the Notes, compounded quarterly. We refer to such deferred interest and the interest accrued thereon collectively as “Deferred Interest.” No interest will be due and payable on the Notes until the end of an Optional Deferral Period, except upon a redemption of the Notes during such Optional Deferral Period. At the end of the Optional Deferral Period or on any redemption date, we will be obligated to pay all Deferred Interest and all interest accrued on the Notes since the immediately preceding interest payment date (which we refer to as “Current Interest”).

        Once we pay all Deferred Interest resulting from our optional deferral and all Current Interest, such Optional Deferral Period will end and we may later defer interest again for a new Optional Deferral Period.

        Obviously they cant suspend unless preferreds and common are also. This is also contained in prospectus….If NSS went back near par, I would be back in for the zillionth time. Many dont realize but NS issued a double digit private placed preferred last year. And insiders gobbled it up from what I read.

  29. Glad I found this site. Knowledgeable people, and right up my alley. I’m taking some profits and going on a cruise. Back in the game next week. Don’t start the crash without me.

  30. FWIW: More or less across the state and despite low interest rates, a decline in CA home prices which began about 12 months ago is accelerating. Possible addition to the current canaries in the coal mine.

    1. alpha8, can you provide any links to this info? We are actually looking to downsize and this would help us decide if we want to do it now or wait a bit. Thanks!

      1. inspy, The msm is always a bit late to post this type of info so no links, though I’m sure they’ll start appearing in the next 45-60 days. We own and operate two real estate-facing companies that do business throughout CA and to a lesser extent AZ. We’re seeing and hearing a growing narrative from across the state of a marked slowdown in activity that started at the top and has been working it’s way down over the last 6-9 months. The $2Ms have entered the 1.8Ms, the low $1.6Ms to the high $1.3Ms, $575Ks to $525Ks etc. There is still market strength at the lower tiers and in the rental market for now, but these things have a way of continuing to knock down all the dominos.

        There’s always a lot of conjecture of course, though blame is being placed on the constant stream of msm suggestions of recession, flat incomes for the last few years, the sudden decline of funds from China, and SALT. Like yourself, there’s an enormous push in move downs. Some areas are benefitting (or being overrun) by that phenomenon including Boise, Austin, Reno and a number of locations in the southeast. Good luck on your transition – but if you are moving down, though over time you’re more than likely exposed to a greater dollar loss on the sale than the dollar savings at the lower tier.

        1. “There’s always a lot of conjecture of course, though blame is being placed on the constant stream of msm suggestions of recession, flat incomes for the last few years, the sudden decline of funds from China, and SALT.”

          Its important to distinguish on which part of the curve incomes are flat…certainly not on the low end where wages are growing faster than they have in decades. That doesn’t help the real estate market much in California, but its a good sign that a recession isn’t creeping in.

          1. That’s a good point CW and there is still market strength at the lower tiers. Though if history is a guide, the ripple will continue. Headlines in 45-60 should tell the story.

            Received a text today from an associate discussing a seller that lobbed off another $100K from the ask just to get someone to walk through the door. For those involved in alternative financing programs (like Peer Street and the ilk) I would encourage closer scrutiny of the underlying assets – and elevated DD a debt/leverage ratios of REITs focused on SFRs.

  31. Maybe one of you old-hands can tell me about Citigroup’s C-N with a coupon of 7.875%, callable for the past 5 years and has NOT been called. Last at $27.53 yielding 7.15% with what seems to me a HUGE call risk. There must be a lot I’m missing here.

    1. one of the few still tier 1 capital after dodd frank

      has some tax advantages

      that is my guess

  32. I was reviewing the various preferred ETF’s/closed end funds. Are there any that has the following characteristics:
    1. Low fees by the advisor
    2. No stupid rebalancing scheme

    You would think there would be a closed end fund that has the following investment criteria:
    1. Purchases only within a limited price range
    2. No non-investment grade
    3. With an investment bias that favors qualified dividends and disfavors Debt and REITS

    1. Just buy preferreds that have those characteristics. Now that there’s free trades you can build your own mutual fund.
      Many preferreds aren’t rated so the IG requirement could limit your options.

      1. I am actually thinking of starting my own mutual fund (I guess actually 2, one that focuses on qualified dividends (corporate preferreds) that would be held by taxable accounts and one that focuses on ordinary income. (Baby Bonds and REIT Preferreds) that would primarily be purchased by retirement accounts.

  33. I hope this message finds everyone reading this happy, healthy and prosperous. I have been searching for some senior notes that have what I consider decent yields. At Vanguard, I came across the spin-off of DuPont/The Chemours Company and settled on CUSIP 163851AD0 7% due 5/15/25 at a deep discount of 92.545 and a YTM 8.706%. This is definitely NOT a blanket recommendation and I urge each of you to do your OWN deep due diligence before investing one cent of your portfolio assets. Never blindly listen to anyone recommending a security to you as they may not have your best “interest” in mind or know your risk profile. This is a junk bond rated Ba3/BB- and requires one to take some risk.
    Each player must accept the cards life deals him or her: but once they are in hand, he or she alone must decide how to play the cards in order to win the game.” Voltaire
    Nomad

    1. Hi Nomad – Thank you for taking the time to send the info on DuPont. This is not in my lane, but I really appreciate you doing this, and also all your other contributions to the community.
      Stay safe, well, and prosperous.
      Bigbear

      1. Thanks Big Bear! I truly appreciate your thoughts and am happy I could be of help in some way.
        Be well my friend, Nomad

    2. For others trying to make up their mind–From S&P Global Ratings:

      The Chemours Co. Outlook Revised To Negative On
      Weaker Operating Performance; Ratings Affirmed
      August 19, 2019
      Rating Action Overview
      – Operating performance at The Chemours Co. weakened considerably and unexpectedly in the
      second quarter of 2019 and prospects for a quick improvement over the next couple of quarters
      appear low.
      – We are affirming our ratings on Chemours, including the ‘BB’ issuer credit rating, and revising
      the outlook to negative from stable.
      – Although the company’s earnings and credit metrics have weakened, we continue to expect
      that credit metrics will remain appropriate at the rating, including funds from operations (FFO)
      to total debt at 20% on a weighted average basis.
      – The negative outlook reflects our view that credit risks at the current rating are slightly higher,
      with at least a one-in-three chance that credit metrics could weaken over the next 12 months
      to levels below our expectations at the current rating.

  34. These big drops in the market will drag down some preferreds prices.
    I don’t think it will last long but, i will hold off trying to catch a falling knife.
    I await the market to give me a 2% (.50 to .60 cent) drop in the preferreds i am watching.
    Then, i will look for the ones closest to their ex-dividend date.
    Just my opinion

    1. I may regret it, but I sold off my REIT preferreds that didn’t drop today. I like them, I’m just playing for an opportunity to buy them cheaper.

  35. Possible reason as to why NTRS hasn’t called NTRSP yet? Maybe they needed to get this straight first, who knows… maybe they will be able to proceed with the call now…

    From Dow Jones

    Six major financial institutions have agreed to pay a collective $6 million to settle allegations of lax oversight and reporting failures regarding swap activities, the U.S. Commodity Futures Trading Commission has said.

    The six banks were HSBC Holdings PLC’s (HSBC) HSBC Bank USA, Societe Generale SA’s (SCGLY) Societe Generale International Ltd., Northern Trust Corp. (NTRS), NatWest Markets PLC, Bank of New York Mellon Corp. (BK), and PNC Financial Services Group Inc.’s (PNC) PNC Bank, National Association.

    Societe Generale International and Northern Trust were accused of failing to provide adequate supervision of swap activity, and paid the largest fines of the group, the CFTC said Tuesday.

    Societe Generale International agreed to pay a $2.5 million penalty for failing to properly report swap data and not ensuring there were proper policies, procedures and supervision in place to monitor such failures.

    Separately, Northern Trust agreed to pay a $1 million fine for several CFTC and Commodity Exchange Act violations, as well as for failing to properly report hundreds of thousands of swap transactions.

    “We are pleased that the CFTC recognized our substantial cooperation in this matter, as well as the remediation steps we have already taken,” a Northern Trust spokesman said.

    The CFTC accused HSBC Bank of violating swap-dealer risk management regulations, marking the first time such an action has been brought by the agency, it said. HSBC Bank agreed to pay $650,000 and other sanctions to settle accusations that it didn’t establish appropriate risk-management systems for its swap activities and for failing to properly report swap activities.

    The other banks agreed to pay separate fines ranging from $300,000 to $850,000.

    “Accurate reporting is essential to effective fulfillment of the regulatory functions of the CFTC, including meaningful surveillance and enforcement programs,” CFTC’s Director of Enforcement James McDonald said in prepared remarks.

    Through a spokeswoman NatWest said it acknowledges the CFTC’s findings and “has now put this right, having co-operated on this matter with the CFTC and taken substantial action to address the issue.”

    Representatives at HSBC, Societe Generale, BNY Mellon and PNC didn’t immediately respond to requests for comment.

    All of the banks agreed to the settlements without admitting or denying the CFTC’s findings, the agency said.

  36. Search function: I was looking for posts on LXP-C, the search function brought them up, but when I clicked to read them, I was directed to the forum they were posted under, not directly to the post itself. Is there a better way to do it?

    1. Is there any reason why a busted convertible could not be called? With a conversion price of 26.82 not likely to be seen this year, I would think they might call it and issue a replacement.

      1. Hmmm… It’s called “busted” because it’s going to be very hard for the terms of redemption to be met in order for it to be called. I own a bunch of them and am not worried about any of them being called – because they can’t be anytime soon unless the common stock price they are tied to skyrockets up and stays above the strike. Most of these offerings state that there is a time period of which the common has to be at a certain price before the redemption can be made. Here is the blurb from LXP-C as an example:

        On or after 11/16/2009, if the price of the common stock exceeds 125% of the conversion price for 20 of any 30 consecutive trading days, the company may, at their option, force the preferred shares to be converted into common shares at the then prevailing conversion price.

        Unless the common gets to the conversion price and stays there as it needs to, we’ll be able to keep cashing those dividend checks each quarter.

        1. Is it a mandatory conversion? Just looking at quantum, it is listed as convertible at the company’s option, unlikely until it exceeds the conversion price, and they can force conversion if it exceeds 125% of 26.82 for 20 of 30 trading days. In other words, if the company only need to convert at its discretion, why can’t they call it now and re-issue at a lower rate?

          I know I am missing a piece of the puzzle.

          1. I read it to be “optional” – not mandatory. The prospectus definitely states it’s optional. It may or may not be to their benefit to convert, so that is a slick way to allow for some breathing room to either do it or just continue on as is. But they only have that discretion AFTER the common has been trading at 125% + for the required period. The CANNOT call it now, no matter how much they want to. The common needs to improve in price and meet the terms of the redemption. I get what you’re saying, why not call now and issue a lower rate offering. But they can’t.

            On or after November 16, 2009, we may, at our option, cause the Series C
            Preferred Shares to be automatically converted into that number of common shares

            1. I think my problem is not understanding how the convertibles work. I read it as two separate parts–they issued a preferred at a certain yield, and may, if they want, convert the preferred shares to common shares at or above a certain price instead of paying cash. Optionality. I still don’t see how the current stock price has anything to do with them possibly calling this preferred and issuing a new one at a lower interest rate, so I have some homework to do. But thank you for the discussion!

              1. Not sure how else to explain it. I think you should read the prospectus. Maybe that will help? It boils down to this. Lexington cannot force a conversion/redemption of LXP-C unless the price of the common stock ticker LXP stays at ~$33.52 for 20 out of a 30 day trading period. This is where you run into the difference between ‘convertible preferred’ and just plain ‘preferred’ stocks. Convertible stocks are 100% tied to the common stock and will trade accordingly up or down to how the common trades. However, plain preferred stocks are not tied so tightly to the common stock. Sometimes we need to go to the prospectus as just reading the little blurb off of Quantum Online isn’t enough – especially for things like these convertible preferreds. There can be a lot more to the story and you’re only going to fully understand all of the terms if you read the prospectus. But even then, it can still leave your head spinning. Just take a look at DCUE or NYCB-U for examples.You have multiple parts moving in those.

                1. My misunderstanding was that I thought LXP could redeem for cash OR the shareholders could convert into shares if the price was high, a bonus kicker if you will.

                  I did not realize that the conversion/redemption were linked, I was looking at them as two separate possibilities.

  37. Interactive Brokers is preparing to launch a new type of account:

    Unlimited, Commission-Free Trading
    ibkr lite offers clients unlimited, commission-free trading on US listed stocks and ETFs, with low pricing on other products. No Account Minimums or Inactivity Fees.

    https://www.interactivebrokers.com/en/index.php?f=45196

    Wonder how they deal with new preferred and baby bonds coming out to market? Anybody using them now able to advise?

    Looking for an alternative to Merrill where I don’t have to pay for trades…

    1. Fidelity has 500 free trades if you open or add $100,000, or 300 for $50,000. You have 2 years to use them.
      Schwab has the same deal for $100,000 but only for new accounts.
      Chase has free trades and a cash bonus, but they have nothing to offer other than trades. I use them for small trades.
      FirsTrade has free trades, though I’ve heard some bad reviews of their service.
      Then there’s RobinHood and some copycats, though they’re kind of useless.

      1. Thanks Martin. I’ve compiled many statistics from the top dog brokerages but none come even close to what Merrill offers me. I’ve saved over $9K in just the past 4 years by not having to pay for trades. I guess this now offsets any $ missed by having to buy late into new issues – so it’s a wash. I’ll probably monitor the chatter on the new IBKR offering and do the trial account. They do trade pink sheets, which some others no longer do or restrict – so that’s a plus. I guess we’ll see how it unfolds. I was both advising others of a new option and asking questions with the post. Hopefully some others will chime in.

        1. Just a comment that like someone else mentioned, there is no free lunch. Free trades are a gimmick, just like other gimmicks. All these brokers are making money in some fashion. Whether it is on crappy rates on cash sweep accounts, order flow / fills, etc. One may get great price improvement on trades but no free commissions, another may give free trades but lousy fills and poor rates on cash sweeps. I guess my point is you are paying for this in some fashion

          1. I’m not trying to eat lunch or any other meal and I couldn’t care less about rates on sweeps as I keep next to nothing in idle cash. My trading at Merrill isn’t a gimmick or whatever else one wants to call it. When I enter a limit order, it executes at that exact rate or lower – never ever higher than what I specify. If they snitzel a little off of that and can do it legally, what can you do about it and why would it matter? I specified my max or min price I was willing to buy or sell at and that price was met to the penny (or better). Personally, I’ve been doing this long enough to know how the game is played and I’m fine with it as I save silly amounts of money with 100 free gimmicks/shams/scams/commissions/free lunches/whatever you want to term them. Please stick to the points I was stating/asking about. Trying to help myself and maybe somebody else, I now feel stupid for even posting anything and soliciting feedback from anyone else who uses IBKR.

            1. Why would it matter if they to use your words “snitzel a little off of that and can do it legally’ – well I am simply pointing out one way that brokerages can make you pay for something. You may think well all I use is limit orders but that doesn’t necessarily mean you are getting the best possible fill. Sure, you never pay more than you want but you may pay more than you have to.

              Again, there is no free lunch.

              Glad you are happy with the Merrill free trade gimmick. But Merrill, like Interactive Brokers and their new program are not doing free trades out of the goodness of their heart. You pay for it in some fashion. These brokers are in business to make money. And sorry that you feel pointing this out is not helpful. My belief is it is and that it is something people should be aware of

              1. And for the record, I am not saying these gimmicks are good or bad. If you can find a way to limit your activities to take advantage of them to your benefit, great. But most people don’t and end up paying for them in another fashion.

            2. Don’t take my comments the wrong way. Just in a different period of my life when I am only interested in buy and hold.

              Fees do not concern me I’d rather have all my investments in one place so my wife or kids can easily access them upon my death.

              At some point you will transition from making the most money possible to worrying about gifts for your grandkids and buying a new bed for your Great Danes.

              1. This is my job. I don’t have regular employment I sit at the computer and trade stocks while others go to work. It’s also a game, I enjoy playing as much as any other game of strategy.

                1. I hear ya’ Martin. Although I have other business ventures, I do spend ~70% of my time trading. Feels like full time work to me… I’m trying to game the system as much as possible… no different than what the system is doing to me. Many play the dividend capture strategies (taking the money/risk and running), arbitrage moves with companies that you don’t give a hoot about what they do or why, etc. What a brokerage ‘does to me’ is no more right or wrong IMO that what I do to companies with trying to squeeze out another nickel in profit on the transactions. I never made money playing solitaire on the computer, so I just stuck with trading and analysis, lol…

                  Appreciate the info you shared. It jives with what Gridbird and I had been discussing back when he was looking to switch to TDAM. Seems like I’m better off @ Merrill for the time being as this is where I can save the most money on my trading. I’m not much for these teaser deals of free trades within a certain time period. 500 free trades wouldn’t get me thru the first year if that was the deal.

            3. A4I, I like free trades too, and BYGOF, deals at our favorite restarants, companion airfares, upgrades, mileage points and happy hours. And we want our favorite vendors to make a profit, but yes perks matter. 🙂

      2. The Schwab 500 free trade offer does apply to existing accounts, but you can only do it once. After that you can get a lesser amount, I think 200 trades for $100K new assets, unless you talk them into a better deal. Call Schwab Trading Solutions at 877-807-9240.

        A nice thing about Schwab is that small options trades are included in the offer.

        1. I have some related accounts at Schwab, David – thanks. I really like the free DRIP ETF accts they have. Research is pretty good as well.

  38. This is a very Sandbox-type of item. Just wanted to mention that I have finally finished reading Lords of Finance by Liaquat Ahamed. This book has been on my reading list for a long time but once I started I couldn’t put it down. It is very readable and written in a style that brings the subject of high finance to a level that even non-professionals can easily understand.

    If you’re not familiar: the work describes, an almost blow-by-blow account, all the bone-headed moves and wrong decisions made by not only by political leaders but also the heads of the four largest central banks in the period from 1919 to 1933. Their adherence to old ways of doing things and their love of the Gold Standard forced these powerful men to make decisions that destroyed the world financial order and caused years of pain and misery on the population of the whole world.

    We look at the people who run the central banks and assume that somehow they are above the fray of petty politics and will always do the right thing at the right time. Not so, they are human beings like the rest of us and slaves to their own personal, economic and political biases. This book tells anecdote after anecdote, story after story that show that having access to all the economic data in the world is no guarantee that those in decision-making positions will always interpret the data correctly and make the right call.

    Many of the problems and painfully wrong decisions of the 1920s were brought about by the intense rivalry between the four largest economies: US, France, Britain and Germany. Their inability to cooperate and reach a happy medium propelled the people of Germany to elect a mad man to run their country, and who subsequently launched yet another devastating war that would take millions of lives. Today the four largest economies (US, China, Japan and the EU) are still embroiled in intense rivalries that demonstrate, as my French grandmother used to say, “plus ca change, plus ca la meme chose” (the more things change, the more they stay the same).

    I recommend the book.

  39. Public Service Announcement: 9/29 is National Coffee Day!
    If you are lucky enough to live near a Krispy Kreme store, they are offering a free donut and a cup of coffee to folks who mention this fact….enjoy

  40. i Tim,

    Your site just keeps getting better and better. I find myself on your site more and Silicon Investor less.

    In the same vein, would it be possible to add your “Newer/older Comments link on the main page? Right now posts are al over the place. If responding to a post you have to search the entire thread to see where it was posted.

    Also, posts referencing another one lack a “in reply to _____” so readers are not sure what that post is being responding to unless the author adds their name or ticker to the message .

    I know you are busy, so maybe these are already in the works?

    Don’t forget our “donation page” ideas either!

    Quickmoney

  41. Anyone still holding HMLP-A? Yielding 8% at its current price over 27, but wondering how likely it is to maintain that premium.

    1. I am holding HMLP-A and it is very tempting to sell at these prices. They are the largest publicly traded LNG shipping company. Don’t know what the 1.5% jump in price today is about. I will continue to hold as it still is an 8% QDI yield which is hard to replace.

    2. I am holding HMPL-A also and while tempting, no plans to cash in on the current premium it is trading at. Nothing else I can replace it with and feel comfortable at that yield level

  42. What would you do with DLNG-B? Just a few weeks ago, this preferred sinks to $14 not knowing if their debt has been refinanced. They then announce a date for their next earning report, and there is some recovery followed by the hoped for refinancing announcement. Stock goes to $20. They have long term contracts for all their vessels and the cash flow will pay their two preferred issues and other debt although the common div is done for. With a div of 8.75% on the preferred, I am tempted to ride it out, What am I missing?

  43. If someone wants to play the “call game” and is comfortable owning BB paper from Telephone and Data Systems, this 7% note (TDJ) may be worth looking at. I bought 700 at 25.16 this morning. Look at is chart from past 5 days. Drifted down from 25.48 to 25.15 this morning. Look where it was almost 3 months ago and watch the inverse curve show. Next interest payment is 12/12 so we are right in the time of no mans land right now. The perfect time to gamble at this price point. If it doesnt get redeemed, look at the inverse curve from last payment, or collect the interest payment and play again.

  44. With mmkt rates at Fido dropping under 1.7 %, and higher yielding issues are redeemed at a fast pace: it’s no wonder other preferred buyers are doing our bidding.
    I played AVGOP and GLSDP and did well, but bought 400 shs of JMPE at a high price and will have to hold, maybe.
    Fido does not have AGNIP and UTBPP open for trading.
    I guess i will be forced to open an account elsewhere like TD/AM or ETRADE.

  45. Anybody who likes squirrelly preferreds to try to flip out of, trust debt, EP-C is definitely an odd duck. This thing will bounce .50-$1.00 on a given day at times. I picked up 200 at $50 other day on a day it spiked over $51 and rounded out my last 100 at $50.25. It actually is redeemable now at $50 with its 4.75% yield and 2028 maturity.
    Has an owner optional redeem provision that is worthless now. Shares can be converted into ~.71 share of KMI common plus a bit over $25 in cash. I just bought this to see if I can catch one of those 75-$1.00 bounces sometime down the road when I think about it.

  46. At times, I have a difficult time accessing internet web sites, particularly Merrill Edge and Vanguard. The time to log on and for the screens to populate is excessive and often does not happen. I have submitted questions to Google and find a number of people have the experience. I don’t think the problem is with my equipment because it does not occur all of the time. It seems that when I start, in the morning, it is ok. Then, about the time the market opens, the problems occur. Does anyone else have the same problem, and is there a fix? Thanks for your help.

    1. Jag
      I don’t think that you have provided enough information for others to help you. Try alternate browsers, clear all caches, run maintenance programs such as Malwarebytes ( free ), registry cleaners that are free, etc. . Just some small sugggestions. I personally have 10 ( free ) maintenance programs installed in 2 computers and once in a while run them all for one computer while on the other. Just some are: CC Cleaner, Revo unintaller, Defraggler, Bit Defender, ADW Cleaner, Eusing Registry Cleaner, etc and you can clear out unneeded files by going to your main hard drive, right click, and click on properties in order to clean the drives. I ‘gather’ you are using CHROME and you neeed to clear out the cache on that browser. Others here are far more sophisticated in computer use than I am, but I have offered my suggestions. Your problem may be unrelated, of course. Good luck.

      1. Howard, I am dumber than you are rest assured. I had problem with Vanguard pulling up like Jag stated in my chromebook. I cleared out cache and it was then just fine.

    2. Switch over to ipad. Download chrome app. Use chrome in privacy mode (little guy with hat and googles when opening new window).

      Privacy mode prevents your web browser from remembering anything. Many websites may slightly tweak the software from time to time causing things not to display as expected.

      Getting iPad will avoid you having to worry about updating software or virus scanners just use and enjoy

  47. All good things come to an end:
    the Fido mmkt accounts fell out of bed today.
    FDRXX yields 1.75%
    FZFXX yields 1.65%
    I guess we need alternatives like Kynprf and Mint
    Anyone have ideas?

      1. Thank You Martin G,
        I bought FLOT today (No Fee at FIDO).
        It’s 1.28 % higher than my FZFXX account
        I already have enough of Kyn/PF shs.

    1. Anyone have an opionion what to do with BACL and WFCL…both are hovering around $1500….neither will be called in but on the other hand this run has been alittle unexpected….It’s easy to sell but replacing isn’t so easy…thanks.

      1. Craig, for many of us, the run-up of BAC-L and WFC-L has NOT been unexpected. I started buying both at ~1200 and flipped them several times profitably all the way north.

        Then I bought again ~1400 and have watched these de facto noncallables continue to march higher without selling one share.

        Why? I believe we are settling into generational lower rates globally. So if I sold, where would I go for QDI and IG noncallables to replace them? SLMNP? I already own a lot. More MLPs? They’re wonderful, but I already own so much my computer oozes petroleum.

        A lot of folks here are having a ball flipping in and out of various issues for small profits that add up nicely. But that’s not who I am. Hell, I switched to Birkenstocks because I could barely tie my own shoes.

        So as Gridbird (a flipper par excellence) has cautioned, you’ve got to know yourself in this game. That is, do you want to take your profits on these busted converts instead of just collecting the divvies and let rates do what they will? Do you have some other equally nice place to put the proceeds if you sell? Wanna put on your big boy pants and join the flippers? And above all else, do you feel lucky? Well, do you? Only you can decide these things. I do wish you the best of luck whichever path you choose.

        JMO

        1. Thanks…with negative rates on the horizon, I put my gtc sell order in on both @ 1800….yield around 4%….

          1. Well, if they get to 1800, craig, look around and tell me what you see. That 4% might look really good about then.

            JMO

            1. With falling rates CD’s are out of favor whos to say if the 10yr goes to zero, preferreds might go out of favor…..I’ve never had a problem reallocating money…

      2. I bought WFC-L and BAC-L a few years ago, have not sold any. Added couple shares of BAC-L at around $1379, but that all, no other activity and just receiving dividends.

        Wish I had bought more, but I’m glad I did not sell any as was not really expecting this price climb.

        No intentions to sell, since I need the dividend stream to live on.

    1. One way is go to Quantumonline….Then go to “income lists” icon up in green box area. Hit it and then go to “Preferreds Eligible For 15% Tax Rate”. This will have quite a few of them…After you play around, you almost will know without looking what is QDI. Trust preferreds, baby bonds, reits, MLP’s and such usually are not QDI eligible.

        1. Preferred are treated the same as common. If common gets a K-1 so do the preferred.

          Partnerships (and similar) issue K-1s, unless they have elected to be treated as corporations for tax purposes. Quite a few do. Really need to check each and every one. Company websites will almost always tell you their tax status.

  48. Took advantage of Brad promoting EBGEF that he knew little about (very sad) and I had to explain…Anyhow recently rebought at $18.04 and flipped for about 90 cents for a week hold. And then used proceeds to buy EBBNF that I flipped out of to buy EBGEF, at a cheaper price than what I sold them to buy EBGEF…Thank you Bradley!
    Been playing the low yield game too. Sold the other day AILLO at $100 that I just bought a few days before at $96. It was a 4.26% yield issue. Used proceeds to buy AILLM today at $102 which is under redemption price and a 4.92% par yield. While that was a parish issue, I have been diving a bit deeper into issues with low “par” yields selling well below issue price. Bought SCE-D under $21.50 getting a plus 5% yield off a 4.32% “par” yield. SCE-D is one of the “old” SCE issues so it has payment priority over the “new” SCE trust preferred issues.

    1. Gridbird,any thoughts on the WFC-P,WFC-N & WFC-O selling below par all callable just for a little QDI-IG income?
      Thanks B/L

      1. Wells does not seem very aggressive about calling their preferreds and I would be interested in hearing others thoughts about this.

        They only did a partial call in August of Series K (FTF) which is paying about 5.9%. And the 6.0% Series T just became callable on 9/15 but was left alone. So the lower coupons would appear to be safe for a good while.

      2. Hey Lou, you know what is odd is now WFC-L is yielding lower than these and others of the same family. The reason I say this is because for YEARS, WFC-L ALWAYS had the higher yield due to its near perpetual terms. I assume its because people think lower for longer and want eternal call protection with it over the ones you mentioned.
        I would have to agree with 730’s thoughts. I wouldnt lose any sleep owning Wells preferreds. But admittedly its been a few years since I had WFC-L and WFC-J (since redeemed), so I havent been too watchful over most bank issuances. I only have one NYCB-U. It raced up $3 on me past few months and it went over redemption price so I sold. It dipped right back to $50 and I bought back as I missed it already, lol.
        Personally, if I was interested in a QDI bank, I would pocket that extra 20- 25 basis points in yield on the ones you mentioned over say the recent COF-I. That 25 bps, would provide a potential extra dollar in back side price support if rates unexpectedly drifted back up. But admittedly, I just not a real player in these. I tend to hold liquid past call issues with higher than market yield as my trading stash, and then buy and sell illiquids on buy sell price lock ups. Or just hold them and forget about them….The bank trust preferreds that have about dried up were the bank issue sandbox I played in. Those were some good trading times!

        1. COF-P with 6.0% coupon is in the same boat. There are 2 higher yielding COF issues ahead in line to be called. Trading around $25.36, so you will be at break-even after the 12/1 dividend payment and then get an above market yield for however long it lasts.

          1. Tex, its really the inverse of what most people want. Most want liquidity and think illiquidity is bad. I exploit it. I buy into liquidity and sell into illiquidity. See many old preferreds only have a few thousand share trading floats. They can go a long time without trading.
            When someone “dumps” ( a relative word since the floats are small) an illiquid the price drops (or get a load standing bid set on one and wait) from lack of bid support. When the dump is over the trading volume dries up. So bids start creeping up trying to entice a seller. But there arent many. So if one has time and can hold indefinitely you squeeze them by waiting before selling. Earlier this year and last year I exploited one that hadnt previously traded for 12 years. Bought at $140 and within a few weeks dumped at $182. Violates every rule doesnt it…Illiquid and bought 40% above par, lol.
            I try to stay balanced in liquid and illiquids. Pays off in market routs like last December. Illquids dont panic in these routs and in fact usually dont even trade. I took advantage of this to sell the illiquids off into the stiff standing bid orders, and bought those crazy liquid issues that collapsed. Road them back up and sold and then have wormed my way back into other illiquids.
            Remember the 08-09 crisis where most preferreds dropped 60-90%? High quality illiquid issues did not suffer same degree of rout. In fact one that I have owned a few times, actually went up several dollars during that time period…Of course it only traded one time for 200 shares during the crisis though, ha. If you are one that doesnt 100% control your buy sell destiny then they are not probably a wise choice for purchasing though. Or at least keep the lot size small.

        2. Gridbird,I purchased the WFC`S P,N,O under par, also the COF-I in the mid 24`s for a little QDI income.Where do you find all the old ultility preferreds?
          Thanks B/L

          1. Lou, just kind of look here and there. I basically have them all memorized to know…But Tims site in preferreds section has some of them…Screening Quantumonline income list has a lot of them. And OTC Markets website has a preferred stock screener that you can scan through to find some.

        3. Grid, how is NYCB-U over ‘redemption price’? The warrant is to purchase an initial 1.4036 shares (an initial conversion price of $35.62) of New York Community Bancorp common stock for $50, is redeemable on or after 11/04/2007 if the price of the common shares exceeds 125% of the conversion price, and expires 5/07/2051.

          Maybe I’m reading it wrong but I don’t see where the price of the common (now at $12.74/ea) has exceeded 125% of the conversion price of $35.62. Maybe I need more coffee or less tasks on my plate, lol…

          1. A4I, I forget the particulars as I did know them. But conversion is more around $21 area along with share amounts converted. There were two 4 for 3 stock splits about 15 years ago that lowered the conversion price. Bottom line is it isnt going anywhere conversion wise. Now it could be redeemed though at $50. During 08-09 crisis when NYCB-U sagged to under $35 (which was still strong compared to most other preferreds) NYCB made a conversion package offer equal to $39 (cash/stock combo). A chunk of owners accepted so the float size isnt nearly as big as Quantum shows it to be.

      3. My 2 cents …. if what you want is IG, no call risk (meaning little if any loss, not can’t or won’t be called) and are wanting to protect against a lower for longer rate scenario, the past call WFC issues are suitable.

        If rates stay low, or go lower, they may get called but no loss. If rates go and stay higher, you lose. So, it’s a matter of which flank you want to protect.

        Won’t make you rich but won’t leave you broke.

        1. Hi Bob,that is exactly the way i`m playing it lower for longer if it changes push the exit button.
          Thanks for the help B/L

    2. If you thrive on volatility the Canadian resets and floaters are a playground. Brad just threw a little more gasoline on the fire.

      BOC rates have very quickly reversed their upward trend of the last 2 weeks, and price movements have been considerable. PWF, a world class company with S&P A-rated preferred, had one issue drop by more than 4% today.

      1. Bob, Bonehead Brad clearly didnt know anything about the issue. His comments proved it. The writer was minimally more competent. Bradley likes the “coproduced” style Moron uses and is imitating it. Eating chips while scanning the comments trying to add something that makes him appear he was truly involved in the (poor) research.
        With rates sliding again, the smarter play would have been for me just to sell. But I am committed to percentage of cash to owning something so I took more Series L since it didnt lift from the craziness from yesterdays weak article.

        1. It was a terrible article but as you saw lots of folks blindly followed the “advice” on the Enbridge preferred.

          Same on the KKR issues. Some readers actually thought they were getting 6% returns, not the 3% they will actually get.

          If I had fewer scruples or greater need for money I might try my hand at writing bad articles.

    3. The Ca energy pfd have some of the lowest price and highest yields for similarly rated preferreds. SREA , SCE, etc. I’m not even sure what court cases/public statements I should be following?

      1. News feeds from SA are pretty good. Read the quarterly conference calls from companies also as they provide updates there also. That new insurance fire liability law will provide some safety cushion. Despite the risks (which there are) the state clearly wants their utes to remain viable despite the hostile regulatory environment they always have allowed usual generous rates of return.
        Im not a fan, but will allow some money to be put here. And a 30% discount to redemption price allows for some longevity here.

      1. Alpha, he is dimwitted, but is learning, since he didnt respond this time. Usually I nail him for his lack of candor, he replies with some snarky comment thinking he “got me”. Then I bring in the heavy artillery to make him look like a fool. Then he quietly goes to SA and gets the entire exchange removed. I trap them as they arent very smart. I dont lay the trap down unless I have the follow up response to humiliate them already in mind. 🙂
        BTW, that article was a total “mail it in” beat the deadline job effort. Low budget work.

  49. Read and weep ……

    Worth keeping an eye on new FI issues, including ones that aren’t exchange traded. Some lovelies:

    Ameren 2049 mortgage bonds (can’t get much safer), 3.25%;

    Camden Properties 2049 notes, 3.35%;

    CUBI (unrated for practical purposes) 5-year notes, 4.5%.

    All non-QID. Real after tax return on first two is zero.

    I’m going to invest in lottery tickets.

      1. Its his way of saying QDI. Qualified Distributed Income (the 15% tax eligible). I see some people refer to it that way.

          1. RE: QDI, this is where you have to be precise with language.

            Bonds (notes and similar) are never QDI. They pay interest, taxed as ordinary income.

            Preferred (stock) and common stocks pay dividends, which may or may not be QDI. Depends on the issuer. Check QOL.

            This is a generalization. There are exceptions to the rules.

            1. Bob, We need to tag this to my “Par” excerpt, lol…But since obviously debt issuances are never QDI, but they can be described as non QDI, because they arent. They generally do not receive qualified tax treatment and it isnt a dividend payment either, ha.

    1. CUBI pfd are very wide bid ask spreads.I tend to just own these harder to trade. Problem is the common is down and looking like survival is in question. Anytime a new bank tries to spread it’s wings loan loss reserves tend to follow the expansion. I can’t see their financials in same formats I use to use. In other words I’m blind on this one. CEO use to run Sovereign Bank(?)

      1. IYP – Granted their note issue is a small issue, it would seem to me that CUBI’s ability to issue a 5 year note @ 4.50% this week contradicts any question about survivability. Granted the comparisons are somewhat apples vs oranges but 4.50% for CUBI when JMP pays 6.875% for a 10 year issue and RILY pays 6.50% for a 7 year seems to be more a vote of confidence. To me, CUBI’s common problems have had more to do with their botched handling of BankMobile these past years, but even that confusion was brought on by overall growth at the bank and what they felt was required of them because of hitting the 10 bil mark, don’t you think?

  50. Just Sold 1600 (flipping portions) MBNO over 26.10 to capture a bit of Cap Gain in my Roth. Now i’ll hold on to the remaining shares.
    At 26.11 it was a bit tempting, even though i believe it can reach 26.75.
    It’s been a while since i banked a gain.
    Still holding 200 shs RILYG and 1,000 ARRPRB plus Kyneprf,GLU,Afinp and Ahlpre
    My cash position is getting 1.93 mmkt at Fido

    1. Something doesnt smell right there does it Camroc. Like we corresponded privately, his promoting his email to prostitute services with every article seems a bit odd. He isnt going to disclose anything as he never does. But unless he is using Egan Jones as his criteria for IG, or Zimbabwe currency issued IG debt, Im not buying his thesis. The 5 yr spot IG bond market yield is under 2.5%. Im not buying 4.25%-4.5% , 5-10 yr note IG bonds selling under par now. I need proof…And that will not be provided.,.

      1. and the CEF for the other yield achievement that are again undisclosed.. if I remember correctly a while back… were a lot of mlp/midstream levered funds and h/y bond funds.. “but you are getting the income you can reinvest” is a favorite retort or musing of his.. if you are living off of some of it and were in many midstream levered cef’s, you have a lot of catching up to do in your “reinvesting”..
        while I do like and often employ a barbell approach of safety/risk to achieve a goal, what is written about just seems mostly “risk” to me.
        Grid’s examples of IG are names I recognize.. what are these secret bonds.. and does an individual have access or are they back door institutional only type trades..

      2. Grid – Don’t forget there’s at least one category that you’ve written off in your world and it also happens to be a category that B. Rily is frequently involved in as an underwriter and that area is BDCs. There are a few IG rated BDC names such as Prospect and FSS KKR, Ares and Hercules I believe that could possibly technically meet what he’s saying, but I doubt the universe could be very big if he’s finding stuff to buy at a discount…. Hercules, btw, went rating agency shopping to maintain their IG rating and found the Canadian agency DBRS to maintain their rating so he could be referring to those IG types too… Still his universe would have to be pretty tiny to be achieving what he’s saying…. You’re right – his claim seems uh, dated…

        1. I saw and responded to you. Its like you said…Mostly stray riff raff IG at best. Certainly not hidden gems. Anything IG quality pays much less than that. He already backed off a bit on second reply. I personally wouldnt perceive whats out there as his secret sauce to safety paired with his high yield CEF he was implying.

          1. See 362337AK3? That one has a yield through the roof in comparison.
            GTE North? Seems like a pretty stable business.
            that is the only one other than Ford Motor Credit and Pemex that are coming up in my screen.

            1. Justin, I believe the GTE North was part of that packaged crap that Verizon dumped onto Frontier and laughed all the way to the bank. This was part of the acquisitions that has about sunk Frontier. S&P has that one B-. The inter dealings with Frontier here would be way beyond my scope of understanding to look at.
              Ford Senior Unsecured just got downgraded to junk in past couple weeks. Im not suggesting these are good or bad investments, it just doesnt appear to be IG debt that he claims to be as a safe anchor. Maybe my definition is too high.

              1. Well, you are also being a little strict when you compared 5 year bonds versus what he actually said, which was 5-10 year, and yes, 5 year bonds are non-existent, but there are quite a few 10 years.
                Not sure if they should be lumped together, but Ford the company and Ford Credit have two different ratings, and Ford Credit was not downgraded.

                1. Justin, Ford Motor Credit got downgraded in lock step with parent Sept. 9 with Moodys. I just checked. You can see it in Sept. 9 article in Moodys, but you need to sign in with free account. They dont like their info copied and pasted so I wont.
                  When I responded to him in SA I was referring to Ameren having a 6.5 yr bond at sub 2.8% and LYB with Baa1 and 7.5 yr maturity and it was 3.3%. I probably lead you to believe I was zeroed in on 5 but I wasnt. So yes, he is technically correct, but it isnt what conservative investors view as IG. Its the bottom of the crap heap. Not what I personally believe as being as a safe counter to the other barbell. But my standard my be a bit unforgiving, granted.

                  1. hmm.
                    that is surprising, since they are two different animals. Ford Credit is dependent on the borrowers, where Ford the parent is dependent on the manufacturing of cars.
                    It may be the debt structure, but the bond screen picked up 0 Ford Bonds, but like 30-40 ford motor credit ones.

                    1. This is what I suggest: Go to wherever you screen bonds and ask for 5-10 year tenors with IG ratings and and sort by yield based on ask price (high to low). Look at the 5%+ yielders.

                      If you want to hold that portfolio, be my guest!

                    2. Yes, but capital support wise, Ford the parent is the ultimate guaranteer. I suspect is the culprit. If you dont have Moodys account that explicity shows it, here is a cut from a CNBC article.
                      The rating for Ford’s senior unsecured notes and its corporate family dropped to Ba1, the top rating for debt that’s not investment grade. It had been Baa3, the lowest investment grade rating.
                      https://www.cnbc.com/2019/09/09/moodys-downgrades-ford-credit-rating-to-junk-status.html
                      Ford Credit, of course, is part of the family.
                      Im no credit whiz, but I would take my chances with Baa1 Ford than some of that other Baa3 muck rated stuff. Ford has some structural problems, but presently has more cash on its books than it has actual debt though. That means near term there is so real material threat there.

                  2. Grid, enough already with the Moody’s talk! Geesh! Egan Jones is the authority here. Please refrain from making common sense with this talk of ratings from Moody’s. It blows the whole theory out of the water for people like Mr. Moron on SA and your buddy Pendy. lol!! IF it weren’t for the ‘bottom of the crap heap’, they’d have nothing to write about for their ‘premium service’ victims, err, I mean, subscribers.

                    Even Egan Jones rates Mr. Moron with an A-.

                    1. A4I, Isnt it amazing those dimwits all love citing bond ratings to bolster their case. Until they dont pay attention to them and call NSS a “high quality bond”, and they had no clue it was a B rated issue until we put their feet to the fire.

                    2. Grid – Oh yeah, that was a fun one watching the HDO boys bob and weave when confronted about their NSS statements vis a vis rating agency ratings…. They want to rewrite what the investment community historically calls “quality,” even if the issue they talk about might be a better than average pick within the category traditionally termed “junk.”

                    3. 2WR, if they just said “we believe it to be high quality junk”, no one would have complained. But yes, they in turn doubled down on high quality and perceive to state their Mickey Mouse credit analysis was superior to the three major credit ratings…By about 6 notches worth, lol.

  51. The use of “Par”….Been meaning to write this since Tim briefly mentioned it last week as something that annoys him. Anyone who says “My preferreds are being redeemed at par” for the most part better hope they arent. As par is almost $0.0 or $0.01 anymore. How would you like to buy something at $25 only for company to redeem it for $0.01, lol…
    In fact par is more an accountant term than an investor term. As how much par value a preferred is issued at effects “the books” on where the issuance proceeds are assigned to. This all has to deal with cash, stock, and retained income inputs. No par, proceeds go to a full stock credit and cash debit. A par value issue has that amount taken from stock credit and into “retained earnings” credit which then equals the cash debit. What one as investor looks for is “liquidation value”.
    Lets take a humorous look at how off our “jargon” really is. Take PSA-T which was redeemed a couple years ago. Most would say “PSA-T was called and will pay back its $25 par stock price”. Technically almost all of that is wrong.
    Companies dont “call” they “redeem”. They may announce a calling to redeem however…. The par value of PSA-T is not $25, but $0.01. One would never want their preferred to be redeemed at par anymore, lol…(now there are old preferreds in existence which I own several where the par values are higher stated such as $100 par, though)….And finally $25 stock price isnt really even its stock price. If one read details one would find PSA-T is actually a $25,000 liquidation share. The $25 is not actually the real share, but a depository share representing a sliver of that true $25,000 stock.
    So in this case (and this is frequent btw) we didnt have “PSA-T being called at $25 par”…We actually have a “calling for redemption notice” of its $0.01 par, $25,000 liquidation priced preferred stock.
    How was that for a pocket pen protecter accountant academic nerd fest food fight? 🙂
    Im guilty of the language misuse…As long as everyone understands the misuse its a nothing burger…Like GLP-A for example..Its a K-1. It does not pay dividends, it pays distributions instead. We too often lump “dividends, interest income, and distributions” under one tent, but there is vast differences in actual words per taxation. As long as one understands that then misusing the words doesnt matter.

    1. Thanks, Grid, and Tim…. I suppose it’s good to every now and then go over the true “facts” regarding the vernacular we all use to be reminded of the essentially irrelevant “nothing burger” differentials between practical usage and accountant’s reality… It’s even better when the attempt is made like you have made to explain why the differentials exist in the first place…. Let’s not forget the same thing applies to common stock as well… You ever notice what par value for common shares normally is? It’s always minuscule…. I know I’ve noticed it before but have never taken the time to question why. I would guess your explanation probably covers that nothing burger as well…

      1. 2WR, your understanding of common stock mirrors mine. It all has to do with some theoretical liability…From Investopia..
        You might be asking yourself why a company would issue shares with no par value. Corporations do this because it helps them avoid liability to stockholders should the stock price take a turn for the worse. For example, if a stock was trading at $5 per share and the par value on the stock was $10, theoretically, the company would have a $5-per-share liability.
        As far as misusing terms go, I am so bad at this…And it gets me in trouble with my GF who is a “precise” person. Just last night we were at a Melting Pot restaurant. The broth was starting to boil on our table…I said, “Its starting to smoke now”….Ok course she responds, “That isnt smoke, that is steam”…Well of course I know damn well its steam and not smoke. But she is going to correct me like I dont know. Its just the word that came out of my mouth…But she isnt going to let it rest, ha.

        1. Does she correct your grammar, too? I’ve learned the hard way to do that silently now in polite company.

          P.S. Don’t give me that tee shirt. 😉

          JMO

          1. Camroc, she lights into me several times a day on that stuff. Mostly from misnaming a place or restaurant. She knows what I mean but she is going to correct me anyways. We got this liquor store in town where we get our wine. Its called Smokeys but it has a big pig on the overhead sign. Im thinking of that pig so I always refer to the place as “Porky’s” and it just drives her nuts!

    2. Good thing to do. The FI vets misuse the terms all the time but we know what we mean (at least I hope). To relative newbies, the misuse of terms can lead to mistakes.

      We should all clean up our language.

      Maybe your girlfriend should edit our posts!

  52. As a follow on to discussion of fixed to float issues I posted the sheet linked below. It will stay up through Sunday.

    Includes QID, non-QID, baby bonds, trust preferred and third-part TP.

    No Canadian resets, no phony floaters (low rates with low mins), no issues I consider uninstallable, and most O&G stripped out.

    Historically, nearly all F2F issues get called. And all but a few a few are selling above call price, which is consistent with a call.

    So the YTC is the key metric for most issues. Don’t buy based on stripped yield unless you can make a good case for an issue not to be called.

    https://docs.google.com/spreadsheets/d/1qNigOmH7v3RzuFJkrjPmTmNP-o_QEd_rgxRy3r7yDbY/edit?usp=sharing

      1. Hi Bob,
        Yes, I am. Moved into it after almost liquidating my involvement in the scam that is Lending Club. Having much more success in this one…

        1. I agree about LC. Lot of work for what you could get from a high grade baby bond. Why bother. Prosper was worse. First CEO fashioned himself a modern day Robin Hood, taking from undeserving investors to give to the more deserving deadbeat lenders. Embarrassed to say he and I went to the same school.

          I have an innate bias against non-listed REITS, but I’m always willing to look. Do you have a prospectus or such you could share?

          I like what the CEO of the soon-to-be-merged companies says about REITS (applies to any other vehicle) with external management and all the fees and conflicts of interest. But I just don’t get his dedication to keeping the company non-listed. They are already an SEC reporter. Listing would be such a small step.

  53. Current Strip Stripped Years
    Coupon Price Price Yield YTC to Call

    Pref 1 5.63% 25.02 24.99 5.63% – (1.22)
    Pref 2 5.70% 26.07 26.04 5.47% 0.35% 0.78
    Pref 3 5.50% 25.7 25.67 5.36% 3.46% 1.36
    Pref 4 5.13% 25.83 25.81 4.97% 3.90% 2.78
    Pref 5 5.50% 26.68 26.65 5.16% 3.66% 3.86

    5 preferred issues. Which issue do you buy based on the above and why? All the same issuer, all the same IG rating.

    1. Formatting lost in posting. Column headings, left to right: Coupon, Current Price, Strip Price, Stripped Yield, YTC and Years to Call.

      1. I’d want 5 w highest ytc. BUT it depends. Some fee based positions might be best in 1. Plus without knowing the issuer and their propensity to call on schedule making a decision not as easy as the exampy.

        Overall for me it’s ytc.

    2. Interesting question. I would buy Pref 1 since there is no potential for capital loss and nice SY. I’d ride it until its called.

      The rest are too low YTC for me to be interested in at this stage.

      1. It would appear that he is referencing the Preferred Storage pfds. In which case Pref 1 is PSA-U which has been called for. So, no point buying it.

      2. I would go for (1) also. The price will remain stable in the face of increasing or decreasing interest rates. Only negative you could lose you investment to a call.

    3. #4.
      The issuer (PSA) waited over a year before calling it, so it is unlikely that the Yield to call numbers are accurate because the actual call would be later, so the 4 years at 5.13% coupons and a price that is not really above par to limit the expected capital loss. (unless they consistently pay ROC), which would change the calculation in a taxable account since the capital part of it would also play into it.

      1. Justin – Regarding YTC in the chart and #4 in particular, I’m guessing you don’t really mean literally what you’ve actually written… The YTC would be accurate as calculated even if they do not call them on that exact date. YTC is providing you the worst case scenario in a set of possibilities…. What actually happens if they do not call on the first date is that you do better than the worst case. It does not make the YTC number inaccurate, right?

        1. Yeah, I edited that sentence badly.
          It should have been “yield to call will be “realized” not “accurate”

    4. It was a bit of a trick question.

      The issuer is FRC. Pref#1 was called 2 days ago, so no point to buying it. Even without that knowledge you could predict a call from the IG rating.

      #2 is a dead cert to be called, too, so I’m not a buyer.

      None of these are buys to me. I plan that the YTC will be in fact what I get, and 3.90% – the best of the remaining issues – is too low. If forced to buy I would make it #4, the highest YTC. The stripped yield is not the metric to go by as you’re unlikely to ever see it.

  54. So Brad Thomas on SA is now recommending “Safe Dividend Stocks You Can Buy”, and ‘his’ article is on Energy Transfer Partners? The first obvious issue is that this isn’t a stock, it’s a partnership. And the second is that this is out of his wheelhouse, no? I have either been away from SA for too long or not long enough. Wow… The iReit oracle now recommending “Safe” stocks… Grid, you wanna take a stab at explaining this one??? lol

    1. That is easy to answer A4I
      “This article was co-produced with Dividend Sensei.”

      Like the Rida Moron crew. Brad has partnered with another writer or two to I guess expand his paid service. Dividend Sensei typically did articles like this

      1. I couldn’t stop laughing long enough to even pay attention to the fine print… SMDH…

    2. A4I–I can explain it—$$$$ he has really turned into a whore for the bucks–this works well in a never ending bull type market–it will come home to roost as you know.

      1. all the “partnering” over there, me head is a spinning.. it is their latest model I guess.. dis-incentivise single author contributors… they are all “boo’d” up as the kids would say to grab those marketplace dolla’s.. and they switch partnerships too.. a lot going on behind the scenes.. I visit sites for an idea (ticker) and do my own dd as I am sure most do.. I don’t pay for anything over there..

        also… don’t think when someone is “tagged” as a contributor, essential subscriber or marketplace subscriber that they are “pay” either.. friends and cozy advisor relationships mean a lot of freebees are being given out at least in the marketplace..

        oh well.. sorry to gossip about SA, I know it bothers some…lol..

        1. SA is a parody of what it used to be. I’ve been saying for maybe 5 years that they are on the same path that Motley Fool was in the dotcom days. Everyone throwing money at pay authors of totally unknown quality and very very questionable ethics. It’s pointless to gossip about the names, we all know who they are.

          I will always remember Tim’s SA writings as my starting point with preferreds (CEF preferreds in particular).

      2. I wonder how many really know the true story of Mr. Brad Thomas. He was so levered up and in over his head into the wrong type of real estate that when the bomb went off in 07-09, he lost almost everything he had. This is why, in large part, he turned to writing for SA in the first place – as I recall him telling the story. Easy money for typing out articles and getting back on his feet somehow. Now sure, anyone who made such huge mistakes should have a story to tell, but I was always hesitant to put much into what he had to say because if he was such an expert, why did he find himself in that position in the first place. Live and learn I guess. I do think he means well, or at least, meant well years ago – but now, he’s just the corner dealer for the dope boy that is SA. Largely the same verbiage, just updated graphs.

        1. A4I, For exactly the reasons you stated I had to comment bigly in his latest posting today. Colorful graphs and cheerleader phrases are just no substitute for properly assessing risk.

          He had the well, audacity, to claim credit agencies were “warming up” to a BB+ rated (B for subordinated debt) company simply because they went from negative watch to neutral.

        2. Yes A4I, I am aware of Brad Thomas’s back story – and at one time I do think he meant well and provided decent research. Not that I agreed with all of his conclusions but he had some well researched articles that put some different REITS on my radar many years ago. But like many on SA, over the last few years he has just become another money whore pumping out article after article

          1. Maverick61, I echo your thoughts and appreciate line of thinking. BT posted and threatened to sue me (he eventually deleted the post) because I asked for his COMPLETE track record of buys, sells and holds so all SA readers could determine a true and forthright statistical analysis. After his idle threat, I told him I would give him my address so he and his “legal team” could serve me; I went to a Law School and would love to be able to see how they would try and get damages on a 1st Amendment case where I was not slandering or libeling anyone. Brad also threatened another poster here (that I respect greatly) and of course did not follow through on that threat either. BT either filed personal/business bankruptcy (or was in the brink, I could never get a clear story out of him) after his commercial “real estate” empire(!) failed because of too much leverage and debt. My intent is just to inform those that cannot help themselves and blindly trust these “professional” authors that know very little except to write stories and lose their automatons money…
            When it comes to money, everybody is of the same religion.” Voltaire
            Nomad

    3. This is the new SA business model. Thomas is the draw and he hires others to do the work, and published under his name. Leveraging on his name recognition.

      Big $ in it for him if it works out.

      Too many at SA have made a Faustian deal. They have become like the sell-side analysts of old – can’t trust them.

    4. Addressing your question in a generic fashion, NO ONE can write lengthy articles almost daily as Mr Thomas does, even when he states he is traveling, etc. OTHERS are helping write his articles, or writing them entirely. He is part of a combine looking for subscribers.
      I am not criticizing him or his cohorts, just clarifying; furthemore, I rarely read what he
      ‘authors’ and he is going far afield from his field of expertise, which is reits. In fact, I rarely go to S>A> any longer as it is almost purely a
      commercial site now.

    5. A4I, Most people don’t realize Rita Morwa’s last name is actually Offa, pronounced “Off-a”. And The “i” in Rida takes the vowel sound, so pronounced “Write-a”.

      1. I have caught him in too many untruths. His picks are irrelevant to me because of mis truths or lies (depending on how nice one is). His name is pronounced MORON to me, lol.

        1. Grid – don’t hold back. How do you really feel about Rida? I mean deep down?

          What stuns me about Rida is this. He hawks his 8-9% portfolio without any discussion of what that 8-9% consists of. He sets up people for a bloodbath who can’t afford a bloodbath.

          You want a portfolio with 8-9% nominal yield? I can give it to you in a heartbeat. A bunch of high risk crap. No miracle here.

          Identifying high yield opps is the easiest thing in the world. Hey, just buy CBL preferred.

          Rida used to push that one like a broom. Not so much anymore.

          1. Bob, what is disgusting is whenever it is reference they mention that it is “too risky” and we dont recommend it…Ha…What they dont mention is the year before they were recommending CBL common over $8 and to “back up the truck” at $4…And then they say get out of it after a massive loss.

            1. What’s always bothered me about their recommendations is they always reference their sub investment grade crap as “quality” and it’s obvious that for the most part, they are writing to a relatively naive audience that takes what they write as gospel because it’s being written by the anointed one. They know who their audience is and yet they continue to pass off crap as quality… I’d even be willing to give them the benefit of the doubt if they were willing to describe their opinions on high yield junk as being desriptions of what they believe to be the best of the breed within below investment grade, higher risk world where they live (like NSS) but their constant use of “quality” and “safe” to describe their 11% yield recommendations is shameful… And of course, beyond that, their NEVER admitting when they’ve been wrong especially when they’ve publicly and blatantly gotten the facts wrong initially, just really is dishonest… Don’t get me started on how they absolutely got LMRKN completely wrong initially and now crow about it being one of their best performers…….

        2. It’s the intellectual dishonesty in the name of clicks and the toll we know it takes on the innocent and defenseless that makes it so appalling.

          We could trade off the recommendations because of the way they move the market – but my skin couldn’t take the constant scrubbing.

          1. Alpha, unrelated to the nit wit financial porn guys, I saw a heartbreaking comment from an elderly man in his 70s. He said all they had was SS and they were in 12% and above income issues because that is what they needed to generate the income needed to make it. There is no way this is going to end well for them for any type of duration.

            1. Grid, That is heartbreaking for sure. Wow that does weigh heavy. Folks in their position might be better off with a safe 3.5%-4% yield and amortizing the cash over time. My guess is their funds will last longer. How truly horrible.

              1. And that’s why I posted the F2F sheet. If you want IG there they are, mostly 3-4% YTC, with a few being higher. The higher ones are ag banks (one of my favorites) and Bermudian insurers. Bermudian insurers (and re insurers everywhere) have an inherently risky business model even if their balance sheets are investment grade. In that sense they are overrated.

                One can do a bit better on non-F2F issues, but then you lose the protection in the higher for longer rate scenario. No bid deal to me personally.

                To anyone working with tight numbers in retirement think carefully before getting into a Rida-like high risk portfolio. You not only have risk in the sense of volatility but risk in the sense of permanent capital impairment. You’ll be bagging groceries at Trader Joe’s if that happens.

                There will be better times to buy down the road (I hope).

            2. Given the fact that a large percentage of seniors in the US are in the exact same position, I extrapolate that SA readers likely are too. Unfortunately, there is no acceptable answer for them except to roll the dice with risk. They can’t go back and make different lifestyle decisions now.

              1. I know you are right, and it’s unfortunate.

                One of favorite financial writers is Jared Dillian. Wise beyond his years. He made the point, aimed at the younger crowd, that almost everyone is going to have to economize at some stage of their life. And it’s much easier to economize when you’re young than when you’re old.

  55. Are there any free sites that offer yearly total return data on equities.

    If not what site offers the best spread of financial data behind the paywall.

    1. check Morningstar. They provide total return and for closed end funds provide the data on both nav and stock price. goood luck

  56. Looking for some suggestions in the fixed to floating preferred arena. As an older retiree I’ve been hedging against “lower for Longer” with BAC-l, etc. Would like some protection against long term higher rates.

      1. Yes, I should have offered more clarity. I’m coming up on 76 and my spouse and I have a modest SS income thus we need some steady amount of relatively safe additional income in order to fund something greater than a bare bones life style. I came upon this site via Yield Hunting by Alpha Gen Capital. I feel that the judicious analysis of preferreds, baby bonds, and CEFs
        offer the “do it yourself” investor a superior risk /reward opportunity. That was a long way of saying yes to your question. I’d also like to thank the participants on this board for sharing their insights.

        1. Jim – I looked over the fixed-to-float issues I follow this morning. As you appreciate, but for the wider audience, F2F issues provide you with some rate protection on the upside, but nothing on the downside. They are for that go higher and stay higher scenario.

          You pay a premium for that protection, which is to say you accept a lower yield. Also, the quality of the issues tends to be lower than straight perpetuals. The investment grade folks don’t often offer F2F to the retail market.

          If you’re interested I can give you a list of perhaps 2 dozen F2F that are relatively hairless. Yields will be in the 4-5% range, no more. You can get higher if you give up the F2F structure. And higher in non-QID than QID. I didn’t ask whether this is for taxable or a qualified account.

          CEFs are a good way to go with preferred. You lose individual control but it’s a lot less work. My 3 favorites are DFP, FFC, and FPF. Problem with all 3 is they are expensive now. Very expensive.

          Are you interested in a F2F list?

          1. Bob, it might be interesting to others….including myself….to see such a F2F list. I look at these all the time, but other members might come up with ideas I have missed.

            Special thanks to Gridbird, who always seems to come up with interesting preferred ideas that I have missed in my screens.

            1. Two such F2F ideas that I own are CKNQP and CBKPP. These are high quality (and qualified) and might fit Jim’s needs.

              1. Both CKNQP and CBKPP are core holdings for me. Only problem with them – same with almost everything – is price. The former is priced at a YTC of 4.72% and the latter at 3.67%.

                4.72% is about as fat number as one can find on a quality issue these days.

                The difference in yields is accounted for by the different LIBOR spreads and time to call of the two issues.

                Nominal yield are a good bit higher but these are two issues likely to be called, which is why I focus on YTC.

                If interested, not every brokerage will trade these issues. Vanguard won’t. TDA will. Volumes are very irregular so patience is needed to buy.

          2. Bob – I have been looking at CEFs as well, but have not yet pulled the trigger. I have a question — with rates going lower and a lot of preferreds getting called, how do these CEFs maintain their distributions? Don’t they have to go down at some point?

            1. Generally, they can hold on for a while because each called issue is only a small part of the portfolio and most funds have a cushion.
              Then they start paying out more than they receive in income, so the payments shift to return of capital or capital gains in larger and larger percentages of total income.

              1. re CEF w issues called, replaced w lower yielding issues (Pfds, bb bonds, muni’s, IG/h-y bonds, MBS, CMBS, MLPs etc).. as Justin said eventually either
                1) they payout return of capital or 2) they cut the distributions. If rates stay low of course, the NAV tends to stay strong…so hopefully you don’t lose any principal should you need to sell or switch… of course last fall, yields came down AND values fell too..

                while int rates of course have come down quite a bit in the last year, 3m LIBOR and SOFR rates (currently about 2.14%) on which most CEF’s pay for their leverage hasnt fallen as much as there seems to be a lot of pressure in short term yields vs long term..

                so you could have a real squeeze w all these refi’s at some point on levered CEF’s that not only have less income coming in but also are not really seeing their leverage costs come down.

                like most income vehicles w the FED pushing folks into traditionally riskier asses, imo.. CEFs, pfds, bb bonds, munis, REITs, h/y et al are all way stretched ..and like Tim and renowned investor Howard Marks ( who now is in the Brookfield camp) .. I will take my 1.9-2% in my large cash position and preserve my principal for the inevitable swoons.

                CEF’s that have lagged performance into year end can present great opportunities in tax loss selling season traditionally and you can get nice discounts to NAV and some distorted good values.. but imo again it is going to take a swoon ala 2018 yr end to get these down to interest me again..

                1. Agree on the tax selling. Tax induced selling in CEFs is usually heavy in Nov/Dec. I think it was a contributor to the December crash. There were great deals to be had at the time.

            2. xwords – in a word, yes.

              There is no magic with CEFs. In a low rate environment they get calls like we do. The replacements are lower yield. In time the distribution drops. But it’s a slow decay.

              Besides portfolio return the other big mover on CEF earnings is the leverage spread. The steeper the yield curve the more the leverage works in a CEFs favor.

              I like CEFs for preferred, for most investors, but prices are too high. NAVs are high and discounts are low. Double whammy. Wait for a crash like last December.

  57. Leon Cooperman is well known in the investment world and I pay attention to him because he looks at the investment environment and the economy through a policy (rather than political) lens. As I do.

    Well worth 17 minutes of my time, maybe yours, too.

    https://youtu.be/Pur5tBN1K2c

    1. Thanks for the link, I watched it, smart guy for sure. My favorite part was at 3:18 where he mentioned a guy who made a “shitload of money” 🙂

  58. Curious to get thoughts/opinions about USB/PRH. Par value of $25 but currently trading at $21.27. Current yield is 4.17%. BBB rated. Thanks!

    1. Tex, USB is a top 50 in world bank in terms of safety, so payment is pretty secure. I bet your question is more about yield and price point which is a personal choice.
      Basically this issue was sent to market pre crisis. No one had any idea that Libor would never factor into pricing again. And with Libor at 2% and adjustment factor at 0.60% your yield will be anchored to the 3.5% floor off par. This is why its so far under par. This is such cheap capital for USB that this will have to be presumed “perpetual capital”. Libor would have to get above 3% to improve current yield. But presently we are way under that floor.
      So the stock is caught halfway in middle…Well below perpetual fixed yields of its rating, but above the floor yield due to its pricing being well under par.

      1. To add to grid’s comment, USB-H is “stuck” at 3.5%, with a small possibility of going higher. So, it’s effectively a 3.5% perpetual with a SY of 4.15%. If you’re happy with that, buy away.

        But look at the alternatives. Withing the USB family I, personally, would go for USB-O before the H. SY is 5.12%, but with a very small call risk (stripped price is 16 cents over call). To me, that extra almost 100 bps in yield is worth the small call risk.

  59. I am in the wrong business.
    Nuveen gets $12 million a year to run JPC, which is a preferred stock ETF.

    You would think they would drop the expense ratio since the fund is over a billion in assets and could be run by a part time portfolio manager.

    1. JPC is a closed end fund. Why would a CEF cut its fees?

      JPC is a decidedly middling fund. If you’re going to pay someone 1% to manage a portfolio of preferred, at least go with a top fund.

      When are you moving to Chicago?

        1. The fees on JPC are on par with other preferrd CEFs. My opinion is it’s just not a well run fund. There are better run funds in the space.

          When looking at CEF’s appreciate that you are paying what seems like an out-sized management fee but you are getting 3 things in return: 1) expert management, 2) access to many issues that you, as an individual investor, cannot buy, and 3) the ability to borrow and lever the return at institutional rates.

          If the fund is doing a good job, the alpha added through management and leverage exceeds the management fee, often by a good margin.

          All CEFs can do 2 and 3, so they should be distinguished on the basis of management.

          The data with which to compare CEF returns are readily available, so comparison is just a matter of some leg work.

          In any event, don’t put new money into CEFs, even good ones, if the entry point is not a good one. NAVs and discounts to NAVs will vary widely over the course of a year. Wait until it’s a good time to buy. Then buy a good fund. Buying whatever fund is on sale (highest discount to NAV) will produce poor returns over time.

          1. There are 16 funds in the “preferreds” space JPC is in per CEFConnect. Now when you look at their holdings, I think some of the CEFs take a liberal view of Preferreds and hold some debt issues as well.

            You can slice and dice the numbers anyway you want. But no single CEF stands out as much better or much worse. JPC is right there in the pack, no matter whether you are looking at annual distribution rate, 5 or 10 year annualized returns, etc

            So not sure how anyone could conclude JPC is not a well run fund compared to the other options in the space. That is just not a well supported opinion.

            Depending on what is important to each person (distribution rate, buying when the discount / premium to NAV ratio is advantageous, long term historical results, asset mix, etc) someone could choose any of these CEFs and have a good argument for doing so.

          2. Notwithstanding what follows from “Maverick” there is a not insignificant dispersion in performance among the various preferred CEFs. No matter how measured. JPC is middle of the pack.

            I’ve done the detailed analysis. My analysis is always well-supported. That said, the same people looking at the same numbers can fairly come to differing opinions.

            In the case of Maverick I think it’s just a contrarian personality.

            1. Not sure what your problem is Bob. No need to take personal shots and allusions to “just a contrarian personality”

              That is not what this site is about.

              We all share our opinions. If someone disagrees, that is fine. It is what makes a market. Seems you just don’t like when someone has a different opinion or conclusion than you do.

              I stand by my previous statement.

    1. Hi Bob,

      I have the Feedly reader on my desktop mac and my iPad but I did not find it to be terribly intuitive so you may have to fool with it for awhile. Honestly, I haven’t used it in the past couple of weeks. I think I only used it for one week and then went back to my old ways……just scrolling through my iPad. I don’t spend much time on a desktop. I am pretty much always on my iPad.

      There are others here who are more knowledgeable about the readers than I am. I took my cues from them which is where I got the Feedly idea

    2. Bob,
      Feedbro works very well in both Chrome and Firefox browsers. Let me know if you need help with setting it up. It can hold up to 100 of the last comments made on the site in any of the comment streams.

    1. Jim Wightman–i don’t think so, but it is such a small issue they could call it just to save time and money on future paperwork.

  60. Keeping myself amused: I noticed today where Saul Centers announced the call of BFS-C as expected… Call will be 10/17, BUT SAUL DOES NOT FOLLOW CONVENTION ON CALL PRICE. They are calling 2 days after the normal quarterly payment date of 10/15, BUT on 10/17, they are going to call at 25.00 + .07638 for a total of 25.07638…. That would be accrued from the last ex-dividend date of 10/1, NOT the last payment date of 10/15. That means, as announced, they’ll be double paying an amount of coupon for 15 days…. Announcement reads, “The Series C Depositary Shares will be redeemed for cash on October 17, 2019, at $25.00 per share, plus all accumulated and unpaid distributions to, but not including, the redemption date, for an aggregate redemption price of $25.07638 per Depositary Share.” Were they to pay for the single day after coupon payment date and before call date, accrued would be less than 1 cents…. So either they’re going to correct themselves, or today’s holders of AFS-C thru to the call date will receive a total of 25.00 + the quarterly dividend of $0.4296875 PLUS an additional .07638 for a total of 25.5059675…. I wonder if they’ll correct themselves or are now locked in to this tiny preferred holder’s windfall? There are countless examples of how this is NOT the way it’s supposed to be calculated…. Yeah, I know, pretty boring, but there it is…….

    1. They have every right to correct the error, assuming they spot it. Seems they left it to the new guy in treasury for figure the payment.

    2. As a follow-up on my post RE: BFS-C, upon careful reading, it appears as though BFS has actually done their calculations correctly and that payment due upon call date should be 25.07638. What is unusual is the language in the original prospectus which said, “Dividends will accumulate and be cumulative from, and including, the date of original issuance, which is expected to be February 12, 2013. The first dividend payable on April 15, 2013 in the amount of $0.22917 per depositary share will be for less than a full quarter and will cover the period from the first date we issue and sell the depositary shares THROUGH MARCH 31, 2013 [while payment dates are 1/15, 4/15, 7/15. and 10/15]. That means to me that they put off the initial payment of the 2 weeks between 3/31 and 4/15 and continued to throughout the life of the issue.. That’s why the .07638 will now be paid upon call. What a windfall for shareholders buying now.. At current bit of 25.42, I believe that gives a buyer a 5.60% annualized yield to call date 10/17. Most called bonds/preferreds purchased after announcement of the call have been providing something like 2.75% – 3.75% annualized yields give or take… A picking up pennies strategy score!

  61. Can yields rise much?

    Check out 2 year sovereign debt yields:

    Nation 2 Year Yield

    Slovakia -0.944%

    Denmark -0.873%

    Germany -0.853%

    Netherlands -0.834%

    Finland -0.805%

    France -0.765%

    Austria -0.761%

    Belgium -0.761%

    Portugal -0.645%

    Slovenia -0.639%

    Latvia -0.631%

    Sweden -0.630%

    Spain -0.523%

    Bulgaria -0.519%

    Italy -0.347%

    Lithuania -0.231%

    **The U.S.** +1.676%

    *Data according to Bloomberg

    https://seekingalpha.com/article/4291569-land-free?isDirectRoadblock=false

  62. Call me cynical, but Exelon gets the award for “best joke of the day”. This is their reason from moving to Nasdaq from NYSE this month.
    EXC touts Nasdaq as the platform of choice for many companies that share “our commitment to a low-carbon economy and reducing greenhouse gas emissions.”
    All while they have 14 oil and duel oil/gas plants in production making up 7% of their power production. And Im not a nuke hater, but they got the biggest Nuke fleet in NA, including the infamous 3 Mile Island. That dirty nasty carbon polluting NYSE has got to go!

  63. As the Preferred Doctor asks..What is your pain level 1-10 ?
    I think i’m at 2, Ouch
    It seems “Risk-on” is back. Equities are flying, 10 Yr T-bill is at 1.86%
    Preferreds are hurting eg
    Fifth Third is a phew fractions off
    and Cofol is just awful
    I sold some yesterday and today to raise crash.

    1. COFOL is offal. This is probably the last 5% we’ll see for a while. Who knows, it might really be a perpetual security.

  64. Tim,
    Getting worried about OXLC and OXLCO. I own the O flavor. The yield on the common was showing as pressing 17%. The OXLCO is past first call. I’m wondering if they’re going to “refi” this like many others are doing. Just cannot see how they can sustain much more of a ~17% dividend on the common. IF they cut the dividend, it may bang the pfd’s a bit. I think I’m bailing on this one for calmer waters. Was a good ride while it lasted but this company is just not a place for me anymore in these swirling and uncertain waters.

    1. a4i–thanks for the reminder–I have a few hundred of them (OXLCO) and just looking at it I would think it would be a prime target when they can probably float a new issue at 6.625% right now–their last issue was at 6.75%. I am going to consider bailing as well. Some of these issues I tend to ignore–when I should be reviewing them more often.

      1. I liquidated my OXLCO holding this morning after posting my blurb. I also liquidated CLNY-B as the common stock side has lost ~77% of it’s value over the last ~4.5yrs. Colony is really challenged, IMO.

          1. I’m not sure David, but ANY company that loses that much of their common stock value over such a relatively short period of time just simply cannot sustain whatever business model they have in place. I’m not sticking around to find out if they can turn it around or not. I moved the small bit of $ I had in it into MFA-B for now. Not sure MFA-B is a long term hold but the financials do look night/day better than CLNY. Might move some or all of this $ to RILYZ as RILY has really gotten their act together in a bigly way the past year +, despite all of the haters. It does have some upcoming call risk to consider, though.

          1. Tim, RILYZ seems pretty safe here to me, but did recently hit a 52 week high (what hasn’t). Butttt, RILY is crushing the numbers and I’m able to buy it at 25.66 with call protection until May 2020. Been rotating out of RILYL as fast as possible. RILYZ at a 7.3% yield today, is a good buy in my mind. I don’t pay a lot of attention to YTC/YTW as I have no plan to hold this come hell or high water. So this is just where I’m at, at the moment.

    2. What’s with the big jump in 10 year treasury rate this week from 1.4% to 1.83. Some of my lower rate preferreds have had slight declines this week. Makes me nervous about the low rate 5% preferreds being issued.

  65. For those looking for a small nasty high yield purchase you may look at what Quantum lists as the old PFX…It now trades on the bond desk cusip 71902E208 (has to be called in). I have owned a 1000 for several years and quite frankly dont pay attention to it as it was a hold until redemption/maturity or bankruptcy.
    Anyhow I just noticed on website A.M. Best and Fitch have both reviewed it this year. A.M. giving it a B+ and Fitch BB+. Here is website rating link.
    https://nsre.com/financial-strength-of-our-insurance-carriers.html
    The company (Phoenix) was bought out by a private equity group a few years back and recapitalized. S&P last reviewed it in 2017 and upgraded from B- to B. The other 2 have since revisited it. I dont know if S&P follows it anymore.
    But last trade was around $17 and that equals a juicy 10.89% yield, plus this Senior unsecured note matures in Jan. 2032.
    As mentioned Nassau Re capitalized, but the reason for Phoenix angst is legacy LTC policies. They long ago exited that segment, but it is still there.
    Insurance financials are beyond my intellect. I was just betting on the recapitalization a few years ago, and improving credit quality. BB+ from Fitch sounds awful juicy for a plus 10% senior subordinate note of a now 12 year note…Buyer beware!
    Another negative…When you buy these from bond desk expect a fleece, so this is not a flip purchase. You buy and hold your nose and pray, or dont buy, because the bond desk would scalp any flipping profits if they occurred and then some.

        1. Finra site didn’t have much more info on this one. Doesn’t seem like S&P would cover this one anymore since it’s delisted. But you and I both know a group that would happily give it an A+ rating – hint Egan Jon_s is their name. Bet you can’t guess!?!? Ha!

          1. A4I, Which I am surprised they didnt go with them, lol….A.M. Best rates insurers and had it a notch above last S&P. Fitch typical falls in line near Moodys and S&P. Very odd they would be more aggressive in rating Phoenix a lot higher than A.M. Best. As I have never really thought A.M. Best to be extremely conservative with ratings. So for me I lean towards A.M. Best B+ over Fitch’s BB+.

    1. For the youngsters in the audience, “R. Zimmerman” is better know by his stage name, “Bob Dylan”. I believe he borrowed the Dylan bit from Dylan Thomas.

        1. Oh, my, Amy, you’re making me feel ancient…Of course I didn’t know who RZ was at the time either but I remember seeing Bob Dylan when he was brought on stage as an unannounced who’s that walk-on at a Joan Baez concert at Forest Hills Tennis Stadium in the summer of 1963…. Oh wait a minute, you probably don’t know who Joan Baez is either… lol.. As Baez later said in song about Dylan from those days, “Well, you burst on the scene already a legend, the unwashed phenomenon, the original vagabond, you strayed into my arms.” Diamond and Rust Whew! Hand me down my walkin’ cane..

            1. Thanks Camroc, that was a good listen. Like the song intimates, nostalgia – it’s a wicked double-edged sword.

            2. You know what seems to be out of place in this song??? What in the world is a pre-love generation hippie folk singer queen doing giving cufflinks to an unwashed Greenwich Village bohemian phenomenon in 1963??????

              1. Love. She was counting on him to be the protest answer, my friend, but instead, he used his folk phenomenon as a stepping stone me while you’re trying to be so cool instead of blowin’ in the Seeger-Guthrie wind. He had visions of Johanna instead…

                That’s why he was booed so lustily when he went electric down on Maggie’s farm…

                I saw him in a church–of all places–in Long Beach, spring of 1965, just before he laid down his acoustic guitar. He really looked bored with Hattie Carroll…

                JMO

                1. But CUFFLINKS??? What’s a 1963 Bob Dylan going to do with cufflinks? lol Don’t they seem out of place as a choice of gift? Boy is this ever Sandbox stuff…. lol

                  1. Perhaps she was trying to clean him up a little. lol. He had started making some money by that time, bought a garden apartment in the Village, etc. So who knows…

                    BTW, it’s prolly okay if we play a bit here. It IS a sandbox, after all. 🙂

                    1. camroc–yes it is ok—I am enjoying the bobby zimmerman chat–a Minnesota iron range boy–which he really kind of hates. He is playing in Mankato, MN next month which is 25 miles from me, but I will pass, although I am sure it will be quite an ‘event’ the quality of the music is destined to be very marginal.

                    2. Thanks for your forbearance, Tim. I didn’t know my little quote–which I thought was investment-related in our changing world–would generate so much back & forth on the guy.

                      But today’s another day, so on we search for yields that are high enough and safe enough to tolerate for a while. Not an easy task, mind you, and it sorely tempts me to just dump more into the busted converts and go have a glass of wine and read a good book…

                      GLTA

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