Foreign Bank Preferreds

[winnie]

Has anyone been looking/buying at these lately?

OK, so I bought some Friday -- the preferred stocks of Royal Bank of Scotland, Deutsche Bank, and ING groep. THey have current yields of between 7.8 and 8%, and yields to call of about 12%. They all qualify for the 15% dividend taax rate.

Now i'm second guessing myself. I suppose none of these will go bankrupt, which would be the only reason for them to suspend payment. And the yields are tempting. But I've already taken a bath on regular domestic bank stocks this year, and wonder if i've set myself up for another one.....

Winnie

 

[twaddle]

There's a new ETF that specializes in this stuff if you want a little diversification protection: PGF.

But we live in interesting times. Housing bubbles in the US, UK, and Oz. Very nervous lenders and investors. Fun read here:

Crisis may make 1929 look a 'walk in the park' - Telegraph

 

[winnie]

Hmm. Nicely written article. Thanks for the link.

The next few months will indeed be interesting. I suspect there will be better bargains yet in this asset class, and intend to try and keep some powder dry....I always tend to buy too early on the way down.

winnie

 

[saluki9]

We have been buying a lot of these. Especially Barclays and Aegon.

 

[winnie]

Hi Saluki--

Yes, I've been looking at Barclays too. But the yield isn't quite as tempting, especially when you look at the common stock...I'm hoping that the BCS preferred comes down a bit.

Today, that looks a bit unlikely -- a large move up in all these securities

winnie