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.
Powell: “The time has come for policy to adjust”
Powell: Cooling of the labor market is “unmistakable” … “we do not seek or welcome further cooling in labor market conditions” … his confidence has grown that inflation is on a “sustainable path” back to Fed’s “goal of 2%”
Powell expressed optimism about the Fed’s ability to steer the economy back to 2% inflation while maintaining a “strong labor market;” he said the current level of rates gives policymakers “ample room to respond to any risks we may face,” including further weakening in the labor market
I liked this review of the Fed speech today. The author (Neil Irwin) had been writing for the Washington Post and NY Times previously.
https://www.axios.com/newsletters/axios-macro-dab8c320-6159-11ef-9a11-bd9626431861.html?chunk=1&utm_term=twsocialshare#story1
Powell’s remarks were as expected but with extra emphasis on the labor market possibly triggered by the large NFP revision. I’m not sure that rate cuts are a cure for employment distress.
This tweet proposes an interesting theory on the direction long-term yields. In a bear steepener, the yield curve steepens (and uninverts) with the help of rising long rates.
https://x.com/Altheaspinozzi/status/1826964465528480229
Up, Up and away. Market futures show opening higher. My accounts are the highest they have ever been. This is even before any rate cuts.
Where is all the euphoria coming from? Wondering about the next market event?
Mine too! Have seen a nice boost so far this day also. Interestingly the floaters I own are virtually all in the green today also. Not sure what the future holds for them though. Guess it will depend on where the Fed winds up. Since most of them are 10 – 11% it will take a significant rate drop to make much difference and bring them in line with the 7 or 8 percenters.
Charles:
“Where is all the euphoria coming from?”
Are you kidding? At Jackson Hole today Powell confirmed that the Fed is about to embark on a long rate cutting cycle. With all three major market indices already at all-time highs, he is spiking the punch bowl. A guy like Volker would have been more inclined to take it away. Many investors now believe the Fed has repealed the business cycle and recessions are a thing of the past. So we may really get a historic melt-up into year-end.
Powell obviously does not care about asset price inflation with stocks, gold, home prices, bitcoin, etc. all at or near record highs.
But if core inflation is now running at only 2.5%, why did I just get hit with a 13% increase in my 6-month auto policy premium at Progressive?
” 13% increase in my 6-month auto policy ”
Take it and be happy. Deflation it is. My policies are going up 35% to 48%.
Bear, activists complain PG&E is gouging customers because it’s for profit. Same is being said about insurance companies. They talk about the cost of taking them over and cost to run them and the story changes.
Since I have to have insurance and electric and gas I might as well get some of my money back as an investor.
Charles, Reminds me another lesson from Pig Pile Sr to a once sniveling teen bitching about gas prices (more to do with the fact I had to pay for my own gas). “Stop bitching”, he said. Buy Exxon stock.
So I did, lol.
1970 I was using my dad’s lawnmower to go around the neighborhood and offer to cut people’s lawns. I was paying for the gas. Cost me 25 cents to fill up a gallon container.
if you heat in the NE or like me your NG is less than 1/2 what it was a few years ago, saving us over $1200/yr. of course no one talks about what goes down who is talking about eggs these days?????????? our Medicare supp plans both went down this year and benefits increased including copays being eliminated for many things. things do go down in price. Auto cycle has peaked competition will return soon, sell Allstate.
I got an email from progressive touting my reduced premium. I checked it and the reduction was $0.15. I must be careful not to spend it all in one place.
my progressive policy just dropped by a small amount
Does anyone have any idea why the Riley common got crushed today while the baby bonds and preferreds were especially strong? Thanks.
Profit taking on RILY stock from the large increase 8/21.
It struck me as strange too. I did not see any news that would explain it in particular.
Another good report out of HOV Hovnanian, added to NONCUM hovnp which is quite active today.. debt paid down more, lots more ‘lots’ added to inventory, common buybacks, activity picked up a lot in last 5 weeks w rates falling..the common stock thinks it is an AI stock or something.
I added to my Hovnanian preferred today. Good yield, company looks solid.
What? You missed it at $2?
Okay, I nibbled. CY 10.6% at 18. Homebuilder. Expecting a bumpy ride.
If HOVNP were to break out of its downtrend channel (as it tried to do today), and I drank a Red Bull or two, I might project the price to 22.72.
Agree Bea, thanks for heads up on this one. BOT some shares to sit on.
For those who are interested in construction news about New Mexico here is a link to a builder magazine.
Constructionreporter.com
They talk about a higher education bond possibly coming in November. Also possible buyout of 7-11 in the works
FTAIP (cum, perp preferred) floats on 9/15/24 at 3ml+6.886%, which would be over 12% currently. Will it be called? Hard to believe it won’t, but…
In the prospectus
https://www.sec.gov/Archives/edgar/data/1590364/000114036119016411/nt10004459x3_424b2.htm
the requirement is 30 days notice.
“If we elect to redeem any Series A Preferred Shares, we will provide notice to the holders of record of the Series A Preferred Shares to be redeemed, not less than 30 days…”
The FTAI website news page shows no specific PR
https://ir.fipinc.com/news-events/news-releases
and nothing on Quantum.
Thoughts?
I sold mine a little above par because of upcoming call date. The lesson is Don’t assume anything.
R2S,
From the Q&A of FTAIs Q1 conference call in April (Angela Nam is FTAI’s CFO):
Hillary Cacanando
Hi. Thank you for taking my question. So this one for Angela. Angela you have two preferreds that go from fixed to floating this year one in September and one in December. Obviously, you’ve had some great returns on those preferred securities. Could you talk about what your plans are for them? And how your discussions are going with the rating agencies?
Angela Nam
Sure. Hi, Hillary. So, yes, you’re correct in our Series As and Bs are converting to floating later this year. And we’re currently planning on refinancing those preferreds before those reset dates. So we continue to reassess that.
R2S, from what I’ve seen, that’s the most recent (only?) mention of calling FTAIP and/or FTAIO. In their July conference call, no mention of them at all.
msg, that would be a sad development for me. Bought FTAIP 4 yrs ago, its been a huge winner, was looking forward to it sticking around past the float date. Will just hold until we hear something.
Me as well, pig pile.
I did swap some into FTAIN last week. FTAIN was trading around 10-25 cents above par and FTAIP was a little higher, when its YTC was pretty low.
I still have some left.
rocks2stocks……. I remember last year a Wells Fargo preferred I held went past the the thirty days window and a number of III’ers commenting that we were safe for getting at least one quarter of the floating divy. Not long after that Wells announced it was being called on the divy date / float! I recall their mumbo jumbo excuse was they had issued a notification (not released as a press release either!) that didn’t make it down to the individual shareholders that met the requirement. I got a few cents out of that holding as I had bought it just before the window thinking we had a good shot at least one or two quarters. Didn’t work out and Wells Fargo is on my list still about that. I wonder if Fortress Aviation will pull the same stunt. Evidently this provision is not really enforced. I have a bunch of FTAIP that I bought a little while ago myself.
dj-
If you read the complete notice paragraph in the prospectus, you’ll see that it includes the same mumbo jumbo.
If the market knew that FTAIP had been called on Sep 15, why isn’t it trading at par instead of 25.55? Price is doing the usual pre-ex-date (Sep 6) run up, leaving the stripped price a few cents above par. Maybe it all makes sense, called or not.
MSEXP IMPORTANT UPDATE:
Per broadridge, Middlesex has now decided the MSEXP is subject to a 1 year holding period. The holder, after transferring shares to BR, must email a certification to Bern Sohler (IR at BR) indicating they have held the shares 1 year.
Looking back at rule 144 the 1 year should only apply to issuers not subject to reporting requirements. MSEX is subject and the holding period should be 6 months.
I’m done with this unless it widens out again.
Thinking about this, if anyone knows… doesn’t fidelity credit shorts to cash and you can then put the money in a MMF? If so, there would be no real holding cost
Thanks for the update.
> I’m done with this unless it widens out again.
So did you actually move to convert your MSEXP or just sell it? I noticed we actually have some volume in it today. 🙂
I sold mine a while back near the peak. I decided I had enough return and the work required for the remainder would be better suited to someone who can navigate these things better than I can.
By the time the year or six month holding period is done I will have made up the difference I left on the table anyway given how well I am doing this year. I have already recovered about a quarter of it.
Some broker with the right connections will hoover these up and take them across the finish line.
bought a bunch of CHSCM at 25.35, adding to small holding, for me a solid tax free yield in the RothIRA, rates drift down in 2025 this looks to drift up to 26.50/27, a favorite of the pfd ETFs too. don’t want to be in the ‘cash trap’ or the tsunami that hits pfds when the floodgates open and rates trend down. Used proceeds from trimming energy and mining shares yesterday.
I picked up some CHSCM and some CHSCN too. Prices are rising.
Nimzo
Bea did you trim any of your Ca energy holdings?
7.25% after tax yield till Nov 1 if you are in the highest bracket: still worthwhile in lower brackets.
Austin, Texas airport bond with a Nov 1 call 5% coupon priced to yield 4.364 to the Nov 1 call. $3+ million available.
cusip 051298eq3
????? What maturity? What official description? Not showing at Fido by CUSIP… New issue? CUSIP wrong? Nov 1 call in what year? If you’re saying YTC on a 5% cpn issue priced at 4.364 YTM will provide a 7.25% YTC for a Nov ’24 or probably even ’25 call, that can’t be right, can it, for ’24 and probably not even ’25… Ooops, I see you’re saying it’s priced @ 4.364% to the call…. what call though?
052398EQ3 Looks close to it. 3.96 ytc now (nov 15, 2024), 4.9 ytm.
Not sure if IB is quoting an incorrect YTC. Maybe with commission of $1 per bond the yield changes that much given it’s only a few months to maturity.
IB charges less per bond.
sorry, nov 24. cusip 052398eq3
I’m looking at it on IB. It’s an austin airport bond..I believe subject to AMT. matures 39, but it will get called Nov 1 with a 5 coupon.
Fido shows it offered at 100.121 for a YTC of about 4.40… Commission of $1 would bring ytc down to 3.96….. I’m not sure to what degree a translation to after tax yield would apply to this situation, so no comment on that point… However, unless there’s info somewhere about this having been refunded, I don’t know why you say it WILL be called – are you saying because of the 5% coupon it will be or do you know something more?
The market is anticipating it can be refunded because similar airport bonds can be issued at close to 4.2%. If it isn’t called I’m happy to have the near 5 YTM tax free even though it’s (I believe this one is) subject to AMT.
Yes, I was presuming.
FHLB – Govt efficiency at its best???? So we know CDs are being called that yield over 5.50% or less and even Agency bonds of the same ilk, too…. So what’s the point of FHLB coming out with this issue, CUSIP 3130B2F67
FHLB 5.98% due 8/22/44 @ 100 WITH A 3 MONTH (11/22/24) CALL? Are you interested in buying Aaa/AA+ 3 month paper yielding almost 6%? This is for you? Interested in locking in nearly 6% on Agency paper for 20 years? This might be for you too…. I don’t get the point of issuing this kind of vehicle but then again, I don’t work for the US Govt either….. I think this originally came out 8/16 and is regular settlement.
The issue above is no longer available. Available right now is 3130B2FE0. FHLB 6%. Due 8/22/2044. 1st call date is 11/22/2044
1st call date is 11/22/2024
Fido has it on their New Issues page… They don’t have yours on that page but they do show that one as being available too… Go figure
take a 20 year agency fixed rate and add an option to call the security at intervals or continuously as the case may be and that’s how the rate was determined.
It may seem like too much of a spread above treasury rates, but if you compare it to, for example a 20 year muni housing bond, which is optionally callable at any time , carries the same rating and is backed by agency insured MBS, you’d be looking at around 4.10-4.20 tax free. If you’re in the max bracket in a no-tax state , take 4.1/.602 [that’s 37 PCT tax rate plus 3.8 NII tax] and you get 6.81 taxable equivalent…even higher if you are in a state with income tax.
I think that rate is inferior to the tax free rate for many people. Obviously , for a tax deferred account or a fund , there are considerations that make the taxable bond preferable.
I’m just going through what I look at in making a decision . This year I won’t be in the max bracket, but if a family member passes away it’s possible I will be there permanently…
All of this takes me onto a tangent of the under 65 crowd saying I’m feeding off the teat of their efforts with Medicare as I’m presently paying more than 100% of the cost of my medicare between premiums and NII tax.
How do people feel about the PCG preferreds? Is anyone buying without the fire claims being fully resolved?
I feel better about owning the SCE issues. If they ever have issues like PCG then I would change my mind real quick.
I got in on the SCE.N issue just above par for a full position. Total luck.
The only PCG issue that may be appealing to me is the non-callable A issue.
However, for the coupon rate and the risk, if I wanted a utility issue like that I would try to grab the more illiquid issues.
I own some pcg-a — less than half of a full position. I don’t intend to buy more. I live in the PG&E service area. We live with the concern that a spark from a PG&E line could start another wildfire. There is no rain here from April or May of each year until November. That is just our climate. But global warming has made everything hotter and drier.
Nimzo
PickleNick;
I live in CA and my city is stuck with PGE. I loaded up on SCE-N for my IRA and my wife’s. SCE has done a much better job of line maintenance and moving overhead lines underground. Also SCE does not cover near as much forested area as PGE does. My daughter lives in the SF Bay area and planned blackouts are still a thing, especially in the summer. I already had SCE-L in both accounts for years, bought it around $17 a share so it’s been paying me close to 8% yield, no worries here about SCE.
Excellent. This makes me feel even better.
Blackouts may trigger refunds or credits but not million dollar law suits.
I was looking at the SCE.L maybe around $18 but got distracted with filling a position for CTA.B which I hope pays 6.5% for the rest of my working life.
With the coupon so low maybe .L is still a steal as interest rates are set to free fall. Missed opportunities are always a heartbreak.
Stay safe
cheers,
PN, Agree with you on illiquids but why not PCG-D (6.54% yield) instead of PCG-A (6%) among PCG preferreds? It is unlikely that PCG-D will be called anytime soon as trades around $19.
MFZ, you are most likely correct about .D not being called for a long time.
I guess for me its just psysological. I have only been income investing for four years or so and it has made a huge difference on my balance sheet. I have been picking up low coupon high IG issues that got hammered when interest rates getting pumped up. The plan is for these no never get called as they were issued when rates were so low and hopefully zero interest rates are in the dust bin of history.
So that gets back to PCG.A, it specifically is non-callable so it would fit into my income plan if I wanted to take the risk but I got SCE.N instead. But then again everyone has a plan until they get punched in the nose.
stay safe
cheers,
PCG Bond: Moody’s – BAA2, S&P – BBB
Yep
I own all of them and bought them with a 8% yield on cost. They have been spending a lot of money hiring independent tree service companies. In my town there is 5 to 10 trucks parked going out and trimming and cutting back trees. They have been very aggressive. The old days of a property owner complaining and refusing are gone. The county or city is going to back PG& E due to the fire danger
My approach is to limit the investment in any utility companies to about 1% of my net worth. This limit is at the holding company level.
The goal is to accumulate at least 20 different companies. So, my target is 20% of my net worth. The one thing that I know is that people will need power and electricity.
In my mind, every utility company has similar risks.
1. Most if not all can defer their interest payments for 5 years
2. Environmental risks of lawsuits for several factors including wildfires.
What about my 1% if they go out of business? If I cannot afford a 1% loss, I should not be investing. So I ignore the above risks with all utility companies.
Would I do so, if any one company was more than 1% of my net worth? No, then that risk becomes more tangible to me. BTW: I seldom buy a non-investment grade utility. My only current exception is AQN.
Great commentary from all. Thank you for the responses.
https://seekingalpha.com/news/4142231-enterprise-products-to-acquire-pion-midstream-in-950m-deal
Humm, you buy a company that takes a toxic substance like H2S out of sour gas so the gas can be sold and transported with less corrosion to transport pipes then you you compress the acid gas and dispose of it in deep wells. What could possibly go wrong? What would the liability be if something did go wrong?
The element S has a lot of uses like for fertilizer but the oil industry is producing an over abundance of the material and has to find ways to dispose of it.
I am no left wing loonie, but I am a NIMBY
Hey Charles – It is a strange one. I think the idea here is that this is actually supposed to be environmentally better…
If we pick H2S – they are separating it from natural gas so the natural gas can be sold to a pipeline and consumed. As opposed to flaring off the gas containing the H2S. Of couse flaing this gas would burn the H2S and put it into the atmosphere – acid rain is a result of that.
I don’t know if it is really environmentally better or not, but we are also talking about the Permian Basin. There is a lot of stuf that gets put down injection wells in the Permian including fracking fluids which are toxic. I own Enterprise and Energy Transfer… even so I would not want this stuff in my back yard either.
Can you imagine being part of the agencies that put out the employment numbers and then see this headline? Ouch.
bloomberg.com/news/articles/2024-08-20/fed-confronts-up-to-a-million-us-jobs-vanishing-in-revision
So does this increase or decrease the unemployment rate?
Surely you don’t think there is going to be an honest effort to hold these agencies accountable?
Maybe after a few drinks tonight I think it could happen. There is always hope.
Then the sun rises tomorrow morning and we are back to reality.
So basically, that is a hard no.
cheers,
818,000 decrease in jobs held
Seeing as that is the denominator
Unemployed/Employed
The percentage should increase
Final revision due February, 2025. Officer Barbrady says nothing to see here.
Really, what is the difference? Makes for big headlines until you realize that is for a year. What has the average revision been? 50,000 down. Now divide that 818 by 12 and you come out with 68,000
As I remember, the important point about large negative revisions to NFP is that they happen when the BLS birth-death adjustment included in the initial estimate is very wrong. It’s an indication of economic underperformance vs. expected and a bearish signal for employment.
Here’s the breakdown of the revision
https://x.com/dampedspring/status/1826266641090621926
Trouble on the X Musk horizon for the 7 leading banks…
Banks Still Stuck with $13 Billion in Risky Loans from Musk’s LBO of Twitter 22 Months Ago, Possibly the Longest Hung Deal of this Size Ever
https://wolfstreet.com/2024/08/20/banks-still-stuck-with-13-billion-in-risky-loans-from-musks-lbo-of-twitter-22-months-ago-possibly-the-longest-hung-deal-of-this-size-ever/
I am reminded of an old Russian saying “Nothing is more permanent than a temporary solution.”
Smile, I am Azure
This is part of the prospectus for CUBI-F preferred Stock. Because they treat it as Tier 1 capital it is somewhat difficult to call. “Our right to redeem the Series F Preferred Stock is subject to any limitations established by the Federal Reserve. Under the Federal Reserve’s risk-based capital rules applicable to bank holding companies, any redemption of the This is quoted as part of the CUBI-F preferred stock. Series F Preferred Stock is subject to prior approval of the Federal Reserve. There can be no assurance that the Federal Reserve will approve any redemption of the Series F Preferred Stock that we may propose. We understand that the factors that the Federal Reserve will consider in evaluating a proposed redemption include its evaluation of the overall level and quality of our capital components, considered in light of our risk exposures, earnings and growth strategy, and other supervisory considerations, although the Federal Reserve may change these factors at any time.”
Does this sound familiar Jack??? This is language from CUBI-C which was called in 2021 along with CUBI-D….. it didn’t stop them from calling back then, so I’m not sure it’s that much of an obstacle these days either… Maybe, though…. It is a different banking environment now than it was then…… BTW, it was inexplicable why they called CUBI-D that year and not E. E actually has a slightly higher Plus rate to LIBOR than D, so it was more expensive for them to leave E outstanding than D. ‘Twas an inexplicable move.
“Our right to redeem the Series C Preferred Stock is subject to any limitations established by the Federal Reserve. Under the Federal Reserve’s risk-based capital guidelines applicable to bank holding companies, any redemption of the Series C Preferred Stock is subject to prior approval of the Federal Reserve. There can be no assurance that the Federal Reserve will approve any redemption of the Series C Preferred Stock that we may propose. We understand that the factors that the Federal Reserve will consider in evaluating a proposed redemption include its evaluation of the overall level and quality of our capital components, considered in light of our risk exposures, earnings and growth strategy, and other supervisory considerations, although the Federal Reserve may change these factors at any time.”
Well, according to the prospectus they can call it on any dividend date. If they are to avoid the dividend after the one that goes ex dividend very soon, they better get a move on. I just bought some today at around $25.30. So with the current dividend I come out smelling like a rose even if they call it. They may be holding out for a reduced interest rate that would make the dividend smaller. It isn’t cheap to float a new preferred.
Well you (we) are in luck, Jack. CUBI-F will live on until at least the the 12/15 coupon….. They’ve already missed their window for 9/15:
If shares of the Series F Preferred Stock are to be redeemed, the notice of redemption shall be given to the holders of record of the Series F Preferred Stock to be redeemed, either by first class mail, postage prepaid, addressed to the holders of record of such shares to be redeemed at their respective last addresses appearing on our stock register not less than 30 days nor more than 60 days prior to the date fixed for redemption thereof…
Maine, I had read a review over on the other site that their non performing loans have been increasing.
Anyone arguing for NYCB -A and NYCB-U besides me?
There’s also listed sub debt .
I presently only have a debt position
I own NYCB-A, but I wouldn’t try to convince anyone else to make that trade – it’s a loser for me so far. I would be happy if Fed euphoria led to a trade up to +/- $22/ share. I would cut it loose there.
NYCB-A 7.8% dividend at current price. Content with that.
Still holding NYCB-U in the green with it as of yesterday.
I’ve been adding to CHSCL here at $25.65 and below. There seems to be a lot of volume in this one over the past several days. Fingers crossed it doesn’t get called!
I also bought some SPNT-B today around $25.12.
Dick—I have an order in for CHSCL at $25.50. Also an order in for CHSCN (7.1%) at $25.25 I own a lot of the latter at $25.25 average cost.
WHFCL is another one to keep on the radar. One of the better run BDCs trading near par when factoring in upcoming ex-div. Could be good for a div flip.
I own SPNT-B, CHSCN, and WHFCL so I’m glad you three have nice things to say about each. 🙂
Maine, I had read a review over on the other site that WHF non performing loans have been increasing.
Hi Charles.
My simple thesis is that 7.5%+ (can buy it near par now, div adjusted) is very good for a high quality BDC manager. My guess is this gets called next September. It’s been while since I spent much time on BDC debt as I have been finding better value elsewhere, but here is my current thinking on why I am comfortable with WHFCL from a credit perspective. It would be great if someone could chime in with additional insights, as I’m sure I’m missing some important aspects.
1) Trust and Quality of Investment Manager – I rate their investment manager (HIG Capital) as highly trustworthy. I believe this matters a lot in the BDC space as BDC debt is hard to blow up (no defaults IIRC) but there are games that could be played (behind the scenes) that make the portfolio more risky than it appears on the surface, especially the valuation process. A reputable firm has more to lose if they are aggressive with pricing/ valuation. HIG is a large credit manager with over $60bn AUM. A large and well resourced manager is also more likely to find ways to support the BDC in times of stress. I would never touch a name affiliated with Prospect or Highland.
2) Quality of Portfolio and Team – This all seems in the “good” category.
>>> It is diversified, both number of positions and industry type. page 3 of presentation link below
>>> Performance has been solid, esp when risk adjusted to higher leverage peers. page 3 of presentation link below
>>>They have a large and well resourced team – see page 4 – “70 dedicated deal professionals”
>>> Investment Portfolio – page 9 – mostly first lien. as mentioned, non-accruals has increased recently to 5.7%. a) as a debt investor, I can live with this as it’s small when considering what it would take to impair the debt, esp when leverage is relatively low (next point). b) even good investment managers will have some defaults – this seems to be a period of one-off defaults that should revert back lower over time.
3) Financing – Amount and Type.
>>>Amount – BDc’s can go up to 2x leverage. WHF has been running between 1 and 1.35x, as shown on page 17, relatively conservative and plenty of cushion to absorb losses before the debt is impaired.
>>>Type – WHF has very cheap financing, with a WAC of 6.4%. They also have access to good investment partners like STRS Ohio.
Don’t get me wrong, I am not a fan of BDC common or the PE industry, but as a debt investor, I am willing to take the risks for the yield.
https://s27.q4cdn.com/509262032/files/doc_financials/2024/q2/WhiteHorse-Finance-Earnings-Presentation_Q2-2024.pdf
Maine, I like what you’re saying. Especially the mention on PSEC., I was burned by them about eight or ten years ago.
I have been on and off on buying more BDC debt. and have been looking at WHFCL trying to decide if I expand my holdings or just add to my existing ones.
Seems like a few others here are looking at the same things I have been.
Speaking of lower risk with OK yield.. Has anyone confirmed that SOFR will replace LIBOR for RZB? The spread is listed as LIBOR + 404.
If yes, it looks good for a safe/ short term yield, as it would likely get called on the June 2026 float date. It trades at $25.20, but goes ex div for 36 cents on Aug 30th.
https://www.quantumonline.com/search.cfm?tickersymbol=RZB&sopt=symbol
https://disclosure.spglobal.com/ratings/en/regulatory/article/-/view/type/HTML/id/2932487
Dick; I hear ya. I own a boat load of the CHSCL. I’ve spoken to their treasurer on 2 occasions. They won’t tell you anything regarding the possibility of a call. So we’ll just hang in there and like You I hope they don’t call it either. The fact that they haven’t called their issues that are past the call dates does give me some hope.
Finally, something interesting? Report out 8/21/24
Fed confronts up to a million US jobs vanishing in revision
https://finance.yahoo.com/news/fed-confronts-million-us-jobs-100000224.html
ATLCP yields 8.38% Ex dividend on 30 Aug. $.48 dividend. I just sold a bunch of ALTCZ and bought the ALTCP. In my tax bracket the qualified dividends don’t get taxed at all.
Back to about 25% in cash which doesn’t seem like much. Trimming a few F2F and looking to move up in quality.
Stores were packed this weekend so people must be spending money.
The ask on PREJF is $17.75 (6.85% current yield) with an ex date coming up on August 30.
https://www.otcmarkets.com/stock/PREJF/overview
Just a suggestion about the “clear cache/dump cookies” tech support solution (from a friend of one of my son’s who managed a big tech support group for a while):
Lots of tech support people try to talk you into dump/clear because they don’t know how to fix something and they hope that clear/dump might miraculously fix something. It might, but if it doesn’t, you get to reset everything you dumped/cleared. Costs the tech support person nothing.
Before you let someone talk you into “clear/dump”, try logging in to the page where you are having troubles using a “private” windows (firefox), or “incognito mode” (chrome) or similar window in whichever browser you use. Those private windows don’t access your regular browser cache or cookies.
If the site works in the private window but not in your regular window, then clear/dump might fix something. This is actually pretty uncommon.
Most of the time, if it isn’t working in a regular window, it won’t work in the private window either – but you will know it isn’t cache or cookies (and you will have saved yourself the headache of resetting everything after the dump/clear).
Obviously this is NOT a 100% fix for every situation, but it only takes a minute to try to login from a private window and you can always dump/clear later – so no harm in trying
I have a big capital loss that I carryover every year…not sure I will ever be able to use it up by the time I die. Does anyone know any preferreds that qualify their distributions as return of capital? This would help me use up this loss and basically make the distributions free of taxes for me.
I know the AAIC preferreds used to be return of capital, but they are history…ARR/PC is also about 50% return of capital. Any others people would know about would be helpful…
Chris are you offsetting $3,000 of capital loss against ordinary income every year? It isn’t much but every little bit counts.
Yes…I have over 100k of losses unfortunately.
Chris,
You might want to look into the tax treatment of options boxes and the ETF BOXX.
And…don’t feel badly. I know a guy who had $3 million in gains one year trading as a partner in a firm. He reported and paid the massive tax. The next year he had $3 million in losses but the firm had changed reporting methods such that the loss went from what would have been an offsetting ordinary loss (trader tax status) to a capital loss with $3000 limit.
Well Chris, dont have 100k but I still have 30k in tax loss carryforwards from the 2014-15 fallout in oil/ng when the Saudi’s decided to deflate US/CA energy plans and bankrupted a lot of small players. One of my many ‘lessons’ learned along the way..so every year I ‘trade’ stocks in my taxable account for gains and use the offset. Kind of takes the sting of the loss away. I am already planning what to sell for gains in January in the taxable for 2025 assuming the gainers are still ‘gainin”.. one name is BTI w a 20%+ gain might use that one for some trimming. Or some ‘overweighted’ pfds w gains. All this work to do in retirement! Bea
Bea,
My 2 cents on large capital loss carryovers:
One person I know has huge carryover losses and what he does is sell dividend issues a day before ex-div.
He figured, why pay tax on dividends, when he can use small and steady cap. gains to lower his carryover tax losses.
He can always purchase the issue afterwards and repeat
Does that make sense?
My error, that wouldn’t work. If you short a stock you are responsible for paying the dividend, unless it was already ex dividend.
Yes….SGOV is one of these issues.
One of my sons is sitting on over $1M in capital loss carry forwards. He was in a startup that fouled up its option plan (too complicated to explain here). He is doing the $3K annual (only take 350 years to work it off!), but he isn’t much for investing so not much in capital gains.
He is hoping his current startup will blow the doors off and generate income that will more than consume those losses. Hope springs eternal in Silicon Valley.
In the mean time, he has some money in BOXX, but we will see how that goes.
Chris,
It’s time to start looking for a marriage partner with capital gains
Chris –
Unless you are content to write the I.R.S. an indefinite 0.00% loan, I believe you really want preferreds that distribute long term capital gains.
Since I eat my own cooking …
Several of the Gabelli family of funds distribute long term capital gains with the remainder of the distribution(s) being 100% qualified.
You can research the tax status of Gabelli CEF distributions, for many years, here:
https://www.gabelli.com/funds/closed_ends/important_tax_info
In 2023, the distributions on GAB-G, GAB-H and GAB-K were ~ 88% LTCG. The distributions on GDV-H and GDV-K were ~ 72% LTCG.
Less favorable from a tax perspective, in 2023, were BCV-A with distributions of ~ 46% LTCG / ~ 12% STCG and ECF-A with distributions of ~ 48% LTCG / ~ 2% STCG. The remainder of the distribution were largely non-qualified.
In 2023, distributions on the sole General American Investors preferred issue, GAM-B, were ~ 76% LTCG with the remainder being 100% qualified.
If you are really looking for preferreds that return capital, the two preferreds of the Gabelli Multimedia Trust, GGT-E and GGT-G, returned ~ 58% in capital with the remainder of the distribution being 100% qualified.
Thanks, CTM….great info and I will look to get some of those you mentioned.
I might be way off here on buying ROC issues, but- wouldn’t you have to put off paying taxes /offsetting them since it would not happen until you sold them? Buy & sell each year would not take advantage of ROC accumulation or be more advantageous than reg cap gains for a stock -right (?)
Chris, you could have started your journey of cap gains several weeks ago when the estimation for a rate cut for Sept was projected to be on the table. Many fixed investments have started their climb. I own several that are already up a few dollars. When/if I sell, those turn into cap gains. The PSA family of preferreds, banks like Wells Fargo and Capitol One, American Homes, Rexford Industrial, and several others. Now they are in favor and investors want them, whereas before they were tossing them out with the trash.
Chris, There is a useful method to turn ordinary interest income into capital gains. It works best when interest rates are high like the past two years and it is 100 percent risk free. Just buy any T-bill or bond without a coupon and sell it before maturity. It’s very easy to do at Schwab as long as you don’t wait until the last week of maturity. Even then one of there bond desk traders can help you exit your position.
35-
How can interest offset cap losses? Interest has its own spot on the front of the 1040.
Gary,
T-bills do not have a coupon. They are interest if you let them mature. If you sell them before they mature they become a capital gain. Example, you buy a t-bill at $98 and sell it at $99.90. Now it’s a short term gain that can offset short and long term losses.
Ah… makes sense- thanks.
35Spline,
This could be a useful tax discussion. On a zero coupon bond you have to pay interest income on the accreted amount annually, no?
Trader,
I only have experience with T-bills. See my reply to Gary above.
Thanks, 35…. I have a Schwab account so I will look into that.
Chris-
I had a few preferreds in 2023 that paid their distributions mostly in return of capital. SRG-A and NXDT-A.
I no longer own SRG-A and got out at a gain. Still a bagholder in NXDT-A (I got that idea from Preferred Stock Trader on SA and it is one of the few from him that has not turned out real well).
Anyone who has a PDF of their Form 1099 from 2023 should be able to provide feedback by looking in their “Non Dividend Distributions (Return of Capital)” section.
Thinking about the USM acquisition by TMUS and wondering what we know about the fate of UZD (6.25% senior BB, 2069, call 9/1/25, last 22.57)…has it been stated explicitly since the May 28 PR? I didn’t find anything nor did I find a closing date.
Anyone with a clue?
I own this and it is my understanding that the debt will be owned by TMUS after the sale of assets is completed. They have not announced what they will do with it, but it wouldn’t surprise me if they decide to call it afterwards since it is a rather high coupon rate
regarding this statement
With -D uncalled and past the call date, it appears that AGM’s desire to make a call is dependent primarily on coupon and comparable market rates and not call dates.
Is this surprising?
Troll, but I repeat myself
good comment..agreed
The bid on CTA-A has moved up to $57.15 (6.12%).
Dick, Wonder why all the interest in several of these illiquids recently.
I might have mentioned this before, but I sold about 750 shares of SOCGP about 1-1/2 weeks ago for 26.30 and it doesn’t seem to show up in Fido’s chart of the stock. Still shows last sale from about July 25th for 26.70 what did it do disappear on the dark web?
Charles,
I sold some SOCGP last Thursday at $26.65, and some on earlier in the week for a few cents more through partial fills of a GTC sell order (total was only about 50 shares for the week) – so I would think that would show in your chart too?
Private, both Fidelity and SA don’t seem to have current chart updates at least as of this morning.
When I saw the sale at 26.70 I figured it was time to sell. I had been trading it a year or so ago but when I was able to lower my cost basis below 25.00 I decided to keep them as a sock drawer to balance my higher risk higher yield holdings. But as Dick and Grid pointed out to me when you get an opportunity to sell something above par and replace
it with the same yield and at par or below it makes sense. Of course my risk factor may go up!
Strange that CTA-B can’t get much “up” action.
Don’t you hate it when your sibling got all of the action?
Ha! The story of my life!
Agreed. Nice quarter with no signs of major disruption in marketing. Also note that the resurgence of the common was accompanied by insider purchasing. Doesn’t sound like a company anticipating a major reckoning. I just wish the DOJ weren’t involved.
Correction – I meant the like button, not the reply button. Proof of concept – Turned on my ad-blocker and the like button disappeared as expected. Although the like button is working fine for me, the “time to edit a post” option has disappeared. Hence I reply to myself. Time to get that donation out to Tim LOL
Bear – have you looked thru this Sandbox section for example with what you’ve observed? Yes it’ll work fine if you want to “Like” a comment in the first 25 listed in the Sandbox, but it will only allow a total of 25 Like buttons to show on a page….. So if you (or at least I) scroll down thru all comments on the Sandbox page, I’ll eventually come to a note saying “Like Button Notice – view.” The previous amount of accumulated “likes” on that comment and everyone before that one chronologically will no longer show. And if you click on that “Like Button Notice – view” it tells me, “(PRO tariff plan allows to show maximum 25 button(s) per page. Upgrade your website plan on LikeBtn.com. To remove such notices uncheck Show Info Notices chekbox on plugin Settings tab.)” Do you not see the same thing? I did check to pause AdBlock, but that didn’t change anything..still the same message
I ‘like’ you 2WR..lol… I believe in the past Tim mentioned that the like functionality has a cost so apparently this is a way to reduce the outlays to pay for the server, IT folks etc? just guessing. Using this ‘like’ service. I admit I am ‘like’ happy as well. To me 99% of the comments deserve a like.
so here is a BeaRant again, sorry.. this brings me to Technology..and I use the term lightly….At least we don’t have ‘two factor authentication’ here…omg, that is the real nightmare anymore..now they want me to get a passkey, use my face (their systems will crash if I do) and fingerprint (h*ll no!) ..to check on Mom’s RX status, I have to sign into her site (I am authorized) they send me a code..but the email I use for important things/financial etc is not ‘recognized’ by them as a valid service. SO I had to give an alternate email I use for 2nd tier importance items, I get that code, put it in, ExpressScripts then wants to send me a new code.. so by now I have 4-5 tabs open to do all this (isn’t that ‘risky’??) find out there is a problem or delay, there system then times me out/ has logged me out..call..on hold 15minutes at least (the ‘chat’ function does not work for this healthplan).. unreal..
meanwhile all our SS#s and personal info are on the dark web now.. Oh Ma Bell, take me away!! where are you!! I remember when PNC started to computerize in 1978 and how it would be better.. we had to keep paper backup because it was always crashing. Now they even charge to have a simple ‘like’ button!! the things you find out. So Tip Tim! !!
I ‘like’ to think I would ‘like’ a simpler world. Just grateful my 90yr old mother has me I guess to deal w this crap. Happy Jackson Hole week! here we go again!
Love it, Bea! I could match you rant for rant, but you write yours betterer than I ever could….
Haven’t checked it. Busy tonight. Took a little side detour with Adblocker after I wrote my post. Became popular. Keep a lot of tabs open. Adblock intercepts 10-25 items average per tab. Suddenly went from 10 to 350 to 5200 intercepts /tab.
Apparent problem: Was reading up on the war news from E and ended up on a news site in U. R was jealous and sent me some love. Computer went into a blue screen and crashed while running anti-malware. A cause for extreme panic until I realized that I’d kicked out the power cord. Back up, software worked. Not looking to be further noticed tonight.
Click to edit is back for me now, yippee.