Preferred Stock Investing-The Good , The Bad and The In Between 2015 - 2020

[Winemaker]

Hey Freedom56, you weren't supposed to get in on Mully's conversation and me until I got my poke filled!


PG&E took a good hit today. Witnesses say that their poles, lines and transformers were some of the ignition sources in wine country. I'm sure their insurance would be involved.

My order for 300 SPLPA last week was filled at $20.77 from my full service guy last week; plus a $50 commission.

 

[Mulligan]

Preferred Stock Investing-The Good , The Bad and The In Between

Hey Freedom56, you weren't supposed to get in on Mully's conversation and me until I got my poke filled!


PG&E took a good hit today. Witnesses say that their poles, lines and transformers were some of the ignition sources in wine country. I'm sure their insurance would be involved.

My order for 300 SPLPA last week was filled at $20.77 from my full service guy last week; plus a $50 commission.

Winemaker, Where is your stubborn line in the sand price tomorrow to fill out your AGO-E position? Freedom56 needs to know to jump you a penny and blast you out of the water again. [emoji4]

 

[Freedom56]

Hey Freedom56, you weren't supposed to get in on Mully's conversation and me until I got my poke filled!


PG&E took a good hit today. Witnesses say that their poles, lines and transformers were some of the ignition sources in wine country. I'm sure their insurance would be involved.

My order for 300 SPLPA last week was filled at $20.77 from my full service guy last week; plus a $50 commission.

What are you doing with a full service broker? $50 commission on a trade? That's nuts. Use Fidelity with $4.95 trades and spend the savings on things like 4K UHD TVs for your home or going out for dinner.

 

[Freedom56]

Winemaker, Where is your stubborn line in the sand price tomorrow to fill out your AGO-E position? Freedom56 needs to know to jump you a penny and blast you out of the water again. [emoji4]

I've got more dry powder ready! A lot of my holdings were called this year and I don't want to buy 30 year BBB+ bonds paying 4.4%. I've been waiting for another selloff of PFF to create more bargains in preferred stocks and investment grade exchange traded notes.

 

[Mulligan]

I've got more dry powder ready! A lot of my holdings were called this year and I don't want to buy 30 year BBB+ bonds paying 4.4%. I've been waiting for another selloff of PFF to create more bargains in preferred stocks and investment grade exchange traded notes.

The selloff has been stubborn in coming hasnt it? Every princess here has a wart on the face. I tend to stay fully invested but my dry powder money is sitting in KYN-F, this way I am getting plus 3% no matter what happens with a A+ Fitch safety rating. And it is more immune to sell offs being so safe, past first call and end maturity in 2020. It hasnt traded below par since 2015 and there have been multiple sell offs since then. It can be snagged in the 25.20s. I would much rather have this than the 4.4% 30 year bonds you are wanting to avoid. My plan is to just sell it off if something drops appreciably as it wont follow southward like the perpetuals would.

 

[Winemaker]

What are you doing with a full service broker? $50 commission on a trade? That's nuts. Use Fidelity with $4.95 trades and spend the savings on things like 4K UHD TVs for your home or going out for dinner.

I have 95% of my investments with Fidelity and megacorp's 401k. When megacorp did not have a fixed income choice, I took $150,000 out and put it in a full service account that was with the same firm that my 401k was with. I was able to get a professional opinion if I could FIRE, plus get some professional drivel. I've been getting the WSJ, and Forbes for 35+years, visit the talking heads on CNBC, Bloomberg, and FOX Business, and tips from Mully. I'm not totally nuts, and I got the papers somewhere around here to prove it.

I'm a buy and hold for the most part, although I did some AA adjustments last week. I have 5 TVs already, and enjoy cooking and drinking my own wine more than eating out. We have traveled 9 weeks from Grapetown, though. DW and I aren't hurting 3 years into this retirement thing,and our SWR is less than 2%, for now. I was concerned about the sequence of returns in the first 3 years of FIRE but I'm over it now. I just may really go crazy and bid $24.97 today for AGOPRE, and get a $5 footlong from Subway.

 

[Coolius]

Looks like I missed out on some exciting action yesterday. Hope you guys got what you wanted.

Was busy with volunteer activity helping load up supplies for the Santa Rosa wildfire victims. Lots of displaced folks putting up at churches, community centers, etc. Lots of need for clothes, food, medicine - even toothbrushes & toothpaste. Very heart wrenching.

I saw AILLL, CNTHP & CNLPL drop like a rock this morning. AILLL even went all the way down to par!

For a moment, I thought that all 3 had been called, but no news anywhere I can find.

But prices have come down for sure - I might grab more while there are sellers.

 

[Freedom56]

I have 95% of my investments with Fidelity and megacorp's 401k. When megacorp did not have a fixed income choice, I took $150,000 out and put it in a full service account that was with the same firm that my 401k was with. I was able to get a professional opinion if I could FIRE, plus get some professional drivel. I've been getting the WSJ, and Forbes for 35+years, visit the talking heads on CNBC, Bloomberg, and FOX Business, and tips from Mully. I'm not totally nuts, and I got the papers somewhere around here to prove it.

I'm a buy and hold for the most part, although I did some AA adjustments last week. I have 5 TVs already, and enjoy cooking and drinking my own wine more than eating out. We have traveled 9 weeks from Grapetown, though. DW and I aren't hurting 3 years into this retirement thing,and our SWR is less than 2%, for now. I was concerned about the sequence of returns in the first 3 years of FIRE but I'm over it now. I just may really go crazy and bid $24.97 today for AGOPRE, and get a $5 footlong from Subway.

We are also into our 3rd year of retirement. Even though we have come to the conclusion that we will never draw down our nest egg which continues to grow in retirement, I still carry the same habits that got me to early retirement - minimize expenses and avoid scammers. I just had so many bad experiences with full service brokers in the early 80's (when I started my career) where I lost thousands every year and paid inflated commissions. Around 1986 I decided to become active in the management of my investments and transferred my money to discount brokers. That was the best decision I ever made. No more cold calls from brokers trying to dump their garbage. I just don't trust brokers, financial advisers, asset managers, etc... I find that they are more interested in their BMWs, image, and paycheck to paycheck lifestyle. We forgo those free dinner investment seminars, throw away the glossy brochures from Fisher Investments, and tell those private wealth managers referred by TD Ameritrade and Fidelity to pound sand.

 

[pig pile]

Looks like I missed out on some exciting action yesterday. Hope you guys got what you wanted.

Was busy with volunteer activity helping load up supplies for the Santa Rosa wildfire victims. Lots of displaced folks putting up at churches, community centers, etc. Lots of need for clothes, food, medicine - even toothbrushes & toothpaste. Very heart wrenching.

I saw AILLL, CNTHP & CNLPL drop like a rock this morning. AILLL even went all the way down to par!

For a moment, I thought that all 3 had been called, but no news anywhere I can find.

But prices have come down for sure - I might grab more while there are sellers.

Even CNIGP traded this morning, that never has volume!!! Was able to rejoin the party on CNLPL (I sold post divy, so get the divvy and shares back $1 cheaper, ). Missed out on the cheap AILLL shares, bummer. Sometimes it pays to have limit orders out there on these things. I'm sure the poor bastard seller put in a market order and got burned. Yikes.

 

[Mulligan]

Preferred Stock Investing-The Good , The Bad and The In Between

Even CNIGP traded this morning, that never has volume!!! Was able to rejoin the party on CNLPL (I sold post divy, so get the divvy and shares back $1 cheaper, ). Missed out on the cheap AILLL shares, bummer. Sometimes it pays to have limit orders out there on these things. I'm sure the poor bastard seller put in a market order and got burned. Yikes.

This strikes me as bogus trades to flush out people with sell orders that kick in on drops... I could be wrong but I have seen this before several times...Notice how anytime something trades a few of us mention we got in? Anybody claiming to get AILLL at 25.10 today? I suspect not... These issues are not getting called (at least for several months) This has happened before...Coolius and I have watched BS trades of CNTHP at $50 while we had standing bids at $52 totally ignored before...
I bought 700 more of AILLL. Just getting back to what my original investing plan was before I got greedy and lucky...Just taking advantage of a rare opportunity to get stuffed on this again and return to my roots.

 

[pig pile]

This strikes me as bogus trades to flush out people with sell orders that kick in on drops... I could be wrong but I have seen this before several times...Notice how anytime something trades a few of us mention we got in? Anybody claiming to get AILLL at 25.10 today? I suspect not... These issues are not getting called (at least for several months) This has happened before...Coolius and I have watched BS trades of CNTHP at $50 while we had standing bids at $52 totally ignored before...
I bought 700 more of AILLL. Just getting back to what my original investing plan was before I got greedy and lucky...Just taking advantage of a rare opportunity to get stuffed on this again and return to my roots.

Just picked up 380 more of AILLL as we speak. Yeh weird stuff happens with these things.

 

[aja8888]

Just picked up 380 more of AILLL as we speak. Yeh weird stuff happens with these things.

Why are all you folks buying more at over $26/share?

 

[pig pile]

Why are all you folks buying more at over $26/share?

So I can sell for over $27 as ex div date approaches

Have actually done that on a number of occasions here in last several months, fully knowing at some point this can head south. Pretty comfortable it will hang around par at the worst due to call possibility. Decent yield for high quality issue. Better than most these days I would say.

 

[Coolius]

Why are all you folks buying more at over $26/share?

AJ, the next dividend for AILLL has already been declared, so that is $0.41 in the bag.

Back that out, and effective cost is $25.93.

Include the fact that most calls have a 30 day advance notice, so that is another $0.13 accrued interest, if AILLL were to be called in early 2018.

So, my exposure to cap loss in event of call is $0.80/share. Yes, not great, but not horrible either considering the stability and safety of the company. the real risk in this issue is the Call Risk.

I feel, as Mulligan does, that AILLL will not be called for a very long time. Thus am willing to risk that 80 cents.

I bought 400 shares at $26.34.

 

[Mulligan]

Why are all you folks buying more at over $26/share?

Its been callable since late 1990s. I have been buying over $26 for years and years now. But I will risk the call for the yield and total sleep at nite safety of the dividend. And of course what Pig said when I am in the mood to flip.

 

[Mulligan]

So I can sell for over $27 as ex div date approaches



Have actually done that on a number of occasions here in last several months, fully knowing at some point this can head south. Pretty comfortable it will hang around par at the worst due to call possibility. Decent yield for high quality issue. Better than most these days I would say.

I have an older on line friend that chews this issue up every chance he gets... He said he bought more today at 26.34-35... Last time I asked he was over 20,000 shares... Just gobbles them up every chance he can.

 

[Freedom56]

I've got more dry powder ready! A lot of my holdings were called this year and I don't want to buy 30 year BBB+ bonds paying 4.4%. I've been waiting for another selloff of PFF to create more bargains in preferred stocks and investment grade exchange traded notes.

Hello Mulligan. Thanks for keeping an eye on AGO-E. I plan to dump if it climbs back over $25.40. It's liquid enough to move in and out with larger positions. Good call!

 

[Mulligan]

Hello Mulligan. Thanks for keeping an eye on AGO-E. I plan to dump if it climbs back over $25.40. It's liquid enough to move in and out with larger positions. Good call!

Based on how AGO-F is trading, I think before now and next exD you will have your shot to flip. This issue seems set up to be a decent play to flip or hold for now.

 

[Freedom56]

Based on how AGO-F is trading, I think before now and next exD you will have your shot to flip. This issue seems set up to be a decent play to flip or hold for now.

If it's next week I will sell. I picked up another 2000 shares of AFC at 25.30 after it went ex-div last (I was already holding 2000 since 2015 purchased at 24.60). I just dumped the 2000 at 25.71. It's hard one to fill. The volume is relatively low. AGO-E is much more liquid. I used to own this one a few years ago but sold it when the PR bond defaults came up. However, that issue has been priced into AGO common stock already. The risks are understood now.

 

[Mulligan]

If it's next week I will sell. I picked up another 2000 shares of AFC at 25.30 after it went ex-div last (I was already holding 2000 since 2015 purchased at 24.60). I just dumped the 2000 at 25.71. It's hard one to fill. The volume is relatively low. AGO-E is much more liquid. I used to own this one a few years ago but sold it when the PR bond defaults came up. However, that issue has been priced into AGO common stock already. The risks are understood now.

Judging by what tickers you have quoted, Freedom, you have more versatility in buying non QDI issues. I never put much money in them knowing I was retiring into my same tax bracket. I should have been more vigilant in funding my Roth over the years.. A bit of a lazy mistake on my part. That is why I scrounge the QDIs more as that is where most of my money is in taxable.
Doesnt look like the arbitrage trade on SPLP-A and T will occur much does it.

 

[aja8888]

AJ, the next dividend for AILLL has already been declared, so that is $0.41 in the bag.

Back that out, and effective cost is $25.93.

Include the fact that most calls have a 30 day advance notice, so that is another $0.13 accrued interest, if AILLL were to be called in early 2018.

So, my exposure to cap loss in event of call is $0.80/share. Yes, not great, but not horrible either considering the stability and safety of the company. the real risk in this issue is the Call Risk.

I feel, as Mulligan does, that AILLL will not be called for a very long time. Thus am willing to risk that 80 cents.

I bought 400 shares at $26.34.

OK, I understand the "flip" side of the strategy. I do the same with CHSCM when it hits $29 I sell and buy back around $26. Thanks.

 

[Mulligan]

Preferred Stock Investing-The Good , The Bad and The In Between

OK, I understand the "flip" side of the strategy. I do the same with CHSCM when it hits $29 I sell and buy back around $26. Thanks.

Investing has an emotional context too. I am not a big trusting investor by trade...I have got better, but unwilling to go further. I dont need top returns, but I will stretch for yield with core money in extra safe issues and accept the call. But I do invest in things I have 100% confidence I will get my damn dividend no matter what happens. And history shows this issue has a stiff backbone when all hell breaks loose.
Look at today....Volume an incredible 45 times 90 day volume and next bid is sitting at $26.48 about a dime lower than yesterdays close and a few pennies above a couple days ago. Most issues would be rocked at 45 times average.

 

[jimnjana]

Jim did you get in today with AILLL? I bought 200 more myself.. One these days I am going to buy something more stupid than my 300share JBR purchase was....And it is going to sting and tick me off and then I will sell off everything and just buy all this and be done with it all.

No. I missed the am fun. I have a limit order in at 26.5 .

 

[Freedom56]

Judging by what tickers you have quoted, Freedom, you have more versatility in buying non QDI issues. I never put much money in them knowing I was retiring into my same tax bracket. I should have been more vigilant in funding my Roth over the years.. A bit of a lazy mistake on my part. That is why I scrounge the QDIs more as that is where most of my money is in taxable.
Doesnt look like the arbitrage trade on SPLP-A and T will occur much does it.

I was not eligible for a Roth IRA due to the AGI cutoff. We were even cut off from spousal IRAs during the last 14 years of my career. Most of my holdings are corporate notes and bonds that trade through the fixed income desk. I try to go for safe yields and mostly stay with investment grade issues. That being said, if the companies debt is investment grade, I don't care if their preferred stocks are rated BB+. The risk of missing a dividend is payment is low.

My core preferred holdings are from banks and insurance companies that are QDI eligible.

I would not buy T at current prices. I use to own it. I bought it below $31 and sold it at $36 about 6 months later and watched it go to $42. Now here we are back at $36. I would be a buyer if it dropped back down to $31.

 

[Winemaker]

They never finished my order at $24.96, I am wailing and gnashing my teeth.