There remains many solid buys available for those still looking to get into many baby bonds or perpetual preferreds. Certainly they are not as great as they were a few weeks or months ago, but some remain pretty darned good.
Here is a list of some of what I was buying near the lows (mostly maybe a dollar off the lows)–many of these I have mentioned in the past couple months. These are just some of the higher quality issues and this is not a complete list. Some of them remain great deals (of course this is in the eyes of the beholder) and I have added to positions many times. I have 19% cash remaining and use any setbacks to finish getting most of this deployed.
Of course this list is not a recommendation to buy–just what I have bought and we all know that every single 1 of us is different in terms of age, risk tolerance and resources available. For me anything investment grade over 5.5% is reasonable to buy–it isn’t the 6% one could garner at the lows of course. It should go without saying that interest rates higher than ‘expectations’ could drive prices down once again.
American International Group 5.85% perpetual preferred (AIG-A) which is now trading at $26.18. I am no longer buying this issue as the price has risen to a point where the YTC is pretty meager. This had traded as low as the $23.75 area in late May–a super bargain at that time.
Assurant Inc 5.25% baby bonds (AIZN) which are just below investment grade. Traded as low as $21/share in May and now at $23.85. Current yield in the 5.53% area.
Athene Holdings 4.875% perpetual preferred (ATH-D). Investment grade and traded as low as $17.50 and now at $21.26 now with a current yield of 5.73% .
Brighthouse Financial 6.75% perpetual preferred (BHFAO). Investment grade and traded as low as $23.50 area in June–now at $26.00
Equitable Holdings 5.25% perpetual (EQH-A). Investment grade and traded as low as $20 and now at $23.45.
Liberty Broadband 7.0% (LDRDP) Redeemable preferred. To be redeemed in 2039. Traded as low as $25.50 and now at $26.23. I added to a previous position a number of times.
RiverNorth Opportunities Fund 6% perpetual (RIV-A). Investment grade and traded as low as the $23.25 area. Added to a position that I bought at the IPO of this newer issue. Now trading at $24.98.
RiverNorth/Doubleline Strategic Opportunities Fund 4.75% perpetual (OPP-B). Investment grade and traded as low as the $19.50 area and now at $21.37 for a current yield of 5.62%–excellent current yield for a A1 issue and one of the best issues out there is terms of safety (of course it could move lower).
In addition to the above I have been buying preferreds (and term preferreds) and baby bonds in the following–
Apollo Global, Saratoga Investment, Enstar, SiriusPoint, Prospect Capital, Arbor Realty, Ready Capital, Priority Income Fund, RiverNorth Specialty Fund, Hennessy Advisors, Oxford Lane, OFS Capital, Eagle Point Credit, UMH and XAI Octagon.
I have sold virtually nothing in the last number of months although most of the investment grade buys are very green.