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Weekly Kickoff

Well here we go again—I am excited to get this week underway—for the 1st time in at least a few weeks I am go to be buying a bit of preferred stock or baby bonds. Mostly likely additions to current positions. Lots of coin in the accounts fro CD maturities on Friday–I feel like a kid in the candy store.

Last week the S&P500 was off by the tiniest of amounts – off .2% after a bit of a tumble on Friday–Nvidia took a fall on Friday and tech stocks pretty much drive the index anymore. Right now the futures markets are down, but this means almost nothing as we all know.

Interest rates continued down last week–closing at 4.08% which was down 10 basis points on the week–not a giant drop but enough to give a bit of a lift to income securities. Last week the economic news continued mixed with a relatively strong job creation number (at 275,000 new jobs), but yet a rising unemployment rate. The job losses and labor turnover report (JOLTs) showed we still have 8.9 million job openings.

This week the key economic news will be the consumer price index on Tuesday and then the producer price index (PPI) on Thursday. The CPI is forecast to be down a bit–but if it is NOT we could see a somewhat severe market reaction. I continue to believe we will see no interest rate cut until at least May, but the data between this moment and mid May will determine FOMC action

The Fed balance sheet assets continue lower with a tumble last week of $30 billion to $7.539 trillion.

The average $25/share preferred stock and baby bond rose in price last week by 10 cents. Banking preferreds were up 12 cents, investment grade issues up by 18 cents, CEF preferreds up 8 cents, mREIT preferreds up 2 cents and shipping issues up 8 cents.

Last week we had no new issues price, but the previous Friday we had Athene Holdings price a new fixed rate reset baby bond with a coupon of 7.25%.

11 thoughts on “Weekly Kickoff”

  1. I’d rather own APOS (26.66) than TPGXL (26.34) at the current prices

    and in fact I do own APOS but from a lower CB

    just my 2c

    1. At $26.29, I get a yield to first call of around 5.6% for TPGXL. I am extremely disinterested at that price.

      At $71, CTA-B has a current yield of 6.34% and is way below the call price of $120. The dividends on CTA-B are qualified while the interest payments on TPGXL are not.

    2. APOS is not QDI – correct? Many other Apollo / Athene preferreds are also non-QDI, so dividends worth less for many if in taxable accounts.

      Some APO preferreds in grey zone like ATH-E which I own and one Schwab says is QDI and Fidelity say it is NOT (trying to get them to treat it QDI so far difficult!). This and some other -ve shareholder actions by APO in the past makes them ‘worth less’ to me than similar others

      1. APOS is a baby bond, but otherwise APO-A and the Athene preferreds should all pay QD. I don’t understand the problem with Fidelity since there is not really a “grey zone”.

  2. closed my quick foray into the NVDS (1.25x NVDA short ETF) call options for a triple+, now back to the land of boredom where I belong!

    1. I haven’t seen anything about it being called, no.

      I suppose there’s an outside chance that they sent a call notice to the depository last Wednesday and they file an 8-K about it today, but the more likely thing is that CFG-D will start floating next month at over 9%.

    1. If you mean this one its out of the gate hot at $25.95 at Friday close.
      TPG Operating Group II, L.P. 6.95% Junior Subordinated Notes due 03/15/2064
      Ticker Symbol: TPGXL CUSIP: 872652102 Exchange: NGS
      Security Type: Exchange-Traded Debt Security

      1. Grid–thats surprising to me – hardly any issues have been coming out ‘hot’.

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