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Anybody else scooping up some high income at bargain prices?
Old 08-11-2015, 01:02 PM   #1
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Anybody else scooping up some high income at bargain prices?

So I've been watching the oil sector bloodbath and have decided that now would be a good time to start buying. This is based purely on a guess that things have already fallen so much that its too good to pass up now.

I'm specifically buying the AMLP mlp etf. Note that the expense ratio on this etf is misleading as the etf takes care of the taxes and actually functions like a company, distributing qualified dividends, i.e. no K-1s.

Right now AMLP is at the lowest prices it has been at in the entire history of the etf (about 5 years).

I've also recently started putting a little into REM which is an ishares etf for mortgage reits. Looking at the price history on it you can see it crashed hard starting in 2007 and has remained low ever since. I wish I had bought some REM a few years earlier.

I personally do not think we are going to see run away inflation and that any rate increases will be very minor and slow for years. IMHO we may look similar to Japan, although not as bad, for the next 10+ years.
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Old 08-11-2015, 01:13 PM   #2
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I've bought RSO and UAN. RSO is an Hybrid MREIT that is down and an earnings miss and upcoming Reverse Split. UAN just announced a merger with another fertilizer company.
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Old 08-11-2015, 01:41 PM   #3
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I recently lightened up on some MLPs I've had for years, locking in profits (took out my investment). Next time the sector jumps, I may sell what's left and buy Exxon, Chevron or Marathon.
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Old 08-11-2015, 01:51 PM   #4
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As I mentioned in the "I like oil" thread, I am pretty heavy in MLP's, which are quality midstream pipeline & storage. I am waiting for a bounce to sell some off and get my energy sector down to a more reasonable percentage for my AA. They are all still up, but not at the stratospheric levels they were a year or so ago. But it's hard to resist the temptation to pick up further bargains.
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Old 08-11-2015, 02:23 PM   #5
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I am considering the AMLP MMP ETF myself.
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Old 08-11-2015, 02:33 PM   #6
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Looks like China devalued its currency today causing commodities markets to tank. With China slowing, oil and other commodities, like copper, will be pressed even more. FCX is almost a hat size in price. XOM got beat up as well.
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Old 08-11-2015, 02:42 PM   #7
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I stick with my tried and true index funds. IVV. 50 shares month. Commission free. I set up a buy ~2% under the opening price of the month and wait.

Maybe the dividends are OK with AMLP, I am not sure. But the S&P will trump that AMLP. Not as exciting, but stable.
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Old 08-11-2015, 05:20 PM   #8
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Speaking of high income in another field .. what do you guys think about Mattel?

Sustainable dividend or value trap? Recent yield is >6% after a lovely collapse ..
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Old 08-11-2015, 06:18 PM   #9
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As I've mentioned in the "I like oil" thread, I've been successfully day trading some large chucks of big oil on the bigger dips this year. Mostly CVX and XOM. I've been afraid to hold any of them for any length of time "so far" and that's proven to be correct (or lucky?). However, I must admit I'm beginning to rethink if now is the time to get back in and buy and hold. Companies like CVX and XOM have been paying regular dividends and seem to be getting pretty cheap (maybe?). Both are very near their 52 week lows at this time. The only thing that scares me about buying a lot of shares of these companies (and holding for a long period of time) is not the current price of oil but the inherent risks associated with the integrated oil industry. However, as I said before, no risk, no rewards.
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Old 08-11-2015, 08:38 PM   #10
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After religiously buying electrical utility preferreds yielding 6.4% to 7% and collecting the dividends like clock work with stable stock pricing I dabbled small into a high yielding 9.5% issue last month. After about 3 weeks I was out $300 and dropped it. Never buy anything with the words "Greek, Shipping, and Commodities" all in the same prospectus!


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Old 08-12-2015, 09:25 AM   #11
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No longer looking for the "big score." Avoiding losses seems more appropriate at my age. My "oil play" is strictly buried within my indexing. YMMV
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Old 08-12-2015, 09:41 AM   #12
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picked up 100 shares of apple at 110 today. Needed to shore up my tech sector, so this seemed like a decent opp.
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Old 08-12-2015, 11:35 AM   #13
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As of now, I am staying far away from Oil stocks - too many politics that are controlling the market. If you read the news reports, demand hasn't changed but nobody wants to cut supply which is causing the tank in prices. Also the price of oil with a normal inflation applied is supposed to be ~$45-50, why it was so high is still unknown to me.

On top of the overpriced barrels, big companies are taking the same thought that "I am not giving up my marketshare" mentality & companies are playing the chicken game of who will cut supply first. In addition, from what I heard Russia's top leaders make lots of money from oil which coincidentally prices started going down as soon as Russia tensions were rising.

Overall, I do not know enough about the valuation of oil companies to get involved and the messy politics behind this one is why I am staying firm in my positions and not jumping in.
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Old 08-12-2015, 06:16 PM   #14
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Quote:
Originally Posted by nerdyJON View Post
As of now, I am staying far away from Oil stocks - too many politics that are controlling the market.
I agree that politics plays a big part in "oil" both nationally and internationally. However, politics plays a big part in many stocks. Some sectors maybe more than others.
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Old 08-13-2015, 12:15 PM   #15
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Originally Posted by Car-Guy View Post
I agree that politics plays a big part in "oil" both nationally and internationally. However, politics plays a big part in many stocks. Some sectors maybe more than others.
Touche - oil seems to be the lucky recipient lately.
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Old 08-15-2015, 07:41 AM   #16
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Great buy hesperas


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Old 08-15-2015, 07:51 AM   #17
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Quote:
Originally Posted by Mulligan View Post
....Never buy anything with the words "Greek, Shipping, and Commodities" all in the same prospectus! ....
You probably could have just stopped after "Greek".
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Old 08-15-2015, 07:56 AM   #18
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Picking at stwd...


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Old 08-15-2015, 11:14 AM   #19
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I agree that politics plays a big part in "oil" both nationally and internationally. However, politics plays a big part in many stocks. Some sectors maybe more than others.
Those who invested in biotech in the early 2000s might remember the Bill Clinton / Tony Blair statement re genome research, and the effect that statement made on their holdings. I w*rked in biotech at the time and my employee stock options at the Fine Former Employer tanked, considerably.
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Old 08-17-2015, 03:47 AM   #20
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Company announces dramatically higher profits, stocks jumps 20%.

Few days later China devalues the yuan with 4%, big headlines here, and said company is associated with China. So .. stock falls back down said 20%. Even though the devaluation has no bearing on its profits.

Irrational markets and international politics in action - superfun.
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