Monthly Hi Yield Portfolio

[mailbagman]

I would lke to thank the few members of this board that have checked out LordXot. Following his advice is a way not to go wrong. His spreadsheets are excellent. Also check out a guy named Stormwatch17. He too has some very good spreadsheets.

I have been into TCAP for several months. Later in September I am going to get over $500 in dividends. THey are rasing their dividends to .52 per share.

[nun]

Quote:

Originally Posted by mailbagman I was just trying to show you what I have been successfuly in doing. If you don't believe me go to Morningstar and look under the forums for a poster named LordXot, read some of his post. You can easily obtain yields of 7 to 10 per cent.

.....sure, but at what risk? heck mREITS like NLY have 13% dividends. If you're "only" getting 10% dividends you are 3% behind the curve. I don't own NLY.

[target2019]

Quote:

Originally Posted by mailbagman I would lke to thank the few members of this board that have checked out LordXot. Following his advice is a way not to go wrong. His spreadsheets are excellent. Also check out a guy named Stormwatch17. He too has some very good spreadsheets. I have been into TCAP for several months. Later in September I am going to get over $500 in dividends. THey are rasing their dividends to .52 per share.

I will check out his spreadsheets when I get more time. Thanks for posting in this thread.

[brewer12345]

Quote:

Originally Posted by mailbagman I would lke to thank the few members of this board that have checked out LordXot. Following his advice is a way not to go wrong. His spreadsheets are excellent. Also check out a guy named Stormwatch17. He too has some very good spreadsheets. I have been into TCAP for several months. Later in September I am going to get over $500 in dividends. THey are rasing their dividends to .52 per share.

So this is a cult? Do we get hooded robes or a ring?

[LakeTravis]

I think one of the biggest mistakes novice investors can make is confusing a return of principal as high dividends.

[mailbagman]

Quote:

Originally Posted by LakeTravis I think one of the biggest mistakes novice investors can make is confusing a return of principal as high dividends.

I do not but stocks that use ROC to fund their dividend pay outs.

[nun]

Quote:

Originally Posted by mailbagman I do not but stocks that use ROC to fund their dividend pay outs.

What percentage of your portfolio is in these various high yield investments? Seriously if you want dividends check out NLY and its mREIT peers. I don't like the amount of leverage they use, but with the Fed promising to keep rates low for years to come they might be good for some folks.

[nun]

I had a look a LordXot's spreadsheet and also Googled him/her. The search brought up a lot of posts to investor sites and quite a few to poker sites too.....make of that what you will.

I'm still interested to know mailbagman's investment mix.

[nun]

Quote:

Originally Posted by nun I'm still interested to know mailbagman's investment mix.

Mailbagman, I'm approaching retirement and I'm interested in your investment mix and your approach to high yield.

[mailbagman]

I have a few CEF's HPS, DMO, FFC

Business Development Corp's - TCAP , ICON Fund #15

MLP's - QRE, LINE

Preferred's - CLNY-A, FUR-D, NRF-B

I

[nun]

Quote:

Originally Posted by mailbagman I have a few CEF's HPS, DMO, FFC Business Development Corp's - TCAP , ICON Fund #15 MLP's - QRE, LINE Preferred's - CLNY-A, FUR-D, NRF-B I

How do these factor into your AA....do you have a guaranteed income so you can invest in these high yield funds and not worry too much about principal, do they form only a small part of your portfolio with most income coming from lower yield/risk funds? Do equity gains factor into your income?

[mailbagman]

I monitor my investments closely. Between stock apprication and my dividends I am up over 10% this year. I suggest you and anyone else go to Morningstat and check the posts of LordXot and Stormwatch17 over the past year.
Once i got this set up It only takes me about 2 to 3 hours per week to monitor these stocks.

I am taking in slighty over $1600 per month in dividends.

[nun]

Quote:

Originally Posted by mailbagman I monitor my investments closely. Between stock apprication and my dividends I am up over 10% this year. I suggest you and anyone else go to Morningstat and check the posts of LordXot and Stormwatch17 over the past year. Once i got this set up It only takes me about 2 to 3 hours per week to monitor these stocks. I am taking in slighty over $1600 per month in dividends.

Some on this board include CEFs in their portfolios and many be mREITs and I'm sure you'll generate some traffic over at Morningstar. But most would only include highly leveraged and high yielding funds as a small component of their overall portfolio and many have planned for returns far less than 10% to meet their retirement income requirements so don't swim much in the high yield pond.

[MooreBonds]

Quote:

Originally Posted by mailbagman I have a few CEF's HPS, DMO, FFC Business Development Corp's - TCAP , ICON Fund #15 MLP's - QRE, LINE Preferred's - CLNY-A, FUR-D, NRF-B I

I also have TCAP, and NRF-B (among many other BDCs and preferreds).

Because I diversify heavily among my holdings (usually shoot for just 100 shares of each preferred that I hold), I can take a little bit of a risk by having a slightly higher weighting in preferreds (about 7% of net worth) and BDCs (5% of net worth). Also, when I look for a preferred to buy, I always look at the company's underlying fundamentals. While business situations could always change, I make sure they have a healthy tangible balance sheet, decent/stable earnings, and don't spit out high distributions on their common stock with a large % of return of capital (which reduces my asset coverage on the preferred, and a sign of management that may not care that much for the long-term capitalization of the company).

Many of the REIT and BDC preferreds that I own, I also have a similar small position in the common stock, since it looks like a fairly attractive investment.

There have been a few preferreds that I bought a while back that burned me (or rather, dissolved to nothing) in the downturn -mainly some mortgage finance companies (Thornburg, Impac, American Home Mortgage)...but that's why I diversify, and am now more careful of leverage and other factors.

As with all of my common stock and ETF/mutual fund holdings, I'm DRIPing my BDCs for now, but I let the preferreds (mainly held in my ROTH and other tax-deferred accounts) spit out the dividends and accumulate them in cash to buy a new acquisition (either common stock or another preferred).

Edited to add: One thing I like about holding preferreds directly versus some of the CEFs mentioned above is that I have a fixed rate for a long time. When rates rise, the CEFs (which are leveraged, and have pretty high expense ratios) will have quite a price adjustment as well as dividend payout adjustment. I'm ok w/ my individual preferred price dropping a little, as I know that if it's called, it will be at $25. If it's not called, I'm happy continuing to receive the 7%-8.5% yield from my original purchase.

[LOL!]

Quote:

Originally Posted by mailbagman I monitor my investments closely. Between stock apprication and my dividends I am up over 10% this year.

An "up over 10% this year" has to be put in perspective.

The S&P500 is up about 16% this year. The Vanguard Target Retirement 2020 fund with its 36% of bonds is up 10.4% this year.

In other words, just about everything is up over 10% this year.

[nun]

Quote:

Originally Posted by LOL! An "up over 10% this year" has to be put in perspective. The S&P500 is up about 16% this year. The Vanguard Target Retirement 2020 fund with its 36% of bonds is up 10.4% this year. In other words, just about everything is up over 10% this year.

dam, Wellesley is only up 8.5% YTD. That's less than 10%, what a dog....

[LOL!]

Quote:

Originally Posted by nun dam, Wellesley is only up 8.5% YTD. That's less than 10%, what a dog....

Wellesley is over 60% bonds.

Wellington is up 10.8% YTD and has about 35% fixed income.

[nun]

Quote:

Originally Posted by LOL! Wellesley is over 60% bonds. Wellington is up 10.8% YTD and has about 35% fixed income.

Exactly. The wink and italics was to indicate irony

[target2019]

Also relevant to a yield discussion:
VWINX Wellesley SEC yield as of 09/07/2012 is 2.54%.

[nun]

Quote:

Originally Posted by target2019 Also relevant to a yield discussion: VWINX Wellesley SEC yield as of 09/07/2012 is 2.54%.

....and you don't dig yourself into a 1% or more expense ratio hole from the start either.