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

[Mulligan]

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

Oh wow - they move fast !! [emoji20]


Well, now that the float is reduced, there should be good possibility of support, hopefully around this $25.80 price. And a safe and reliable 6% yield is acceptable to me.



Those who did not tender were likely holders willing to hold onto a "guaranteed" 6% yield, and not deceived by the $26.50 Origen offer knowing it was effectively $25.73 after div.


I do wish, however, that was a quarterly payout schedule instead of bi-annual. [emoji20] Would be better for the cash flow.

Coolius, here it is...The bastards cleaned out over $11 mill of the float with the buyout...Very quickly I might add...


Balance as of February 15, 2018
$0.00
Scheduled Principal received on securities
$0.00
PRINCIPAL ACCOUNT

Balance as of February 15, 2018
$0.00
Scheduled Principal received on securities
$0.00
Receipt from certain Certificate Holders of 456,160 ($11,404,000 principal amount) Trust Certificates for Optional Exchange and cancellation, leaving 543,840 ($13,596,000 principal amount)

Trust Certificates remaining outstanding on August 2018

Receipt from certain Certificate Holders of 456,160 ($11,404,000 principal amount) Trust Certificates for Optional Exchange and cancellation.

 

[Mulligan]

Ken, here is the Goldman bond that lays in trust in JBK

http://finra-markets.morningstar.com/BondCenter/BondDetail.jsp?ticker=C181534&symbol=GS.SF

 

[Mulligan]

I bought 300 more JBK at $25.70. I got 1000 now... I think I have enough, lol.

 

[bobandsherry]

I bought 300 more JBK at $25.70. I got 1000 now... I think I have enough, lol.

Trying to become a majority shareholder? LOL.

 

[Mulligan]

Bob, I would at least 279,000 more. I would need a serious loan from you to accomplish that! I just like the issue. The inherent value is untappable, but the relative yield value still is. What issue can one buy that has a 4.8% yield, that can be turned into a 6.05% ish YTM, that lays claim to the same bond?

 

[Coolius]

JBK holding steady at ask of $26.30 for days now. No other sellers beside that one lonely 100 share ask on Level II.



Those who tendered their shares now have a realized "loss" of about $0.50 because of the missed dividend.



Perhaps those who did not tender did their homework thoroughly.


Getting more JBK at around $26 would be nice, but we have time as the next dividend is not due until Feb 2019.

 

[brokrken]

OK, guys, I'm all caught up on this. Thanks for all the detail and answering my questions. And I thought the SPLP-A was difficult to understand. This one adds even more complexity. In any case, I'm going to throw in a bid and try and joint he party. I would have no problem putting this one in the sock drawer.

 

[Mulligan]

OK, guys, I'm all caught up on this. Thanks for all the detail and answering my questions. And I thought the SPLP-A was difficult to understand. This one adds even more complexity. In any case, I'm going to throw in a bid and try and joint he party. I would have no problem putting this one in the sock drawer.

Ken just the surface stuff is complex. The nuts and bolts is simple. You lay claim to Goldman Sachs subordinated debt owning this. SPLP-A nuts and bolts are way more complicated and lower rated. Most of complcations of JBK went away when Lehman went away, and lost the lawsuits.

 

[Coolius]

Ken, was that you who just bought up 700 shares of JBK at $26.30 ?



If so, congrats! I don't think you will regret it.



I will keep my $25.90 bid steady and hope for some FUD to occur within the next few months, maybe in October?

 

[brokrken]

Ken, was that you who just bought up 700 shares of JBK at $26.30 ?



If so, congrats! I don't think you will regret it.



I will keep my $25.90 bid steady and hope for some FUD to occur within the next few months, maybe in October?

Nope, wasn't me. I'm actually in at 25.80. So, you'll go before me. I know I shouldn't get hung up on the 20 basis point difference from that trade and what I'm bidding. I guess psychologically I want that YTM over 6%.

 

[Mulligan]

Personally I am done at 1000 shares. My ave is about 25.72. Ken I like staying above 6% YTM myself but I guess its psychological too for me.

 

[Texas Proud]

Guess I will give an update on my flipping...


Aug is shaping up to be a bad month... had one loss and my last trade is looking like a loss also... results will be anywhere between a small loss to a small gain..


Sept is going slow... only one purchase so far as there was not much to buy in the beg of the month... and still holding to my last Aug trade hoping to get a few dollars of profit.. will need to decide if I take a loss an flip into another or hold and hope..


So far for the year the annualized return is 27.5%.... but weighted avg is 38%.... there are times the money is not invested in pref, but I am not counting the income I get off that money....


So, start with $24K... earned just over $4600 YTD... but did not do much flipping until Apr... 3 flips the first 2 months but 21 since Apr with two holdings...

 

[Mulligan]

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

Your just taking a much deserved break! It tends to ebb and flow for me. I suspect when I add things up end of this 3rd quarter I am up 10% this year. I have everything but the kitchen sink thrown in preferreds though. I have had several issues that I have flipped several times in short over. Heck one issue I sold and rebought 30 minutes later earlier this week at 37 cents lower, then today sold them alI 45 cents higher again! Just rotate in and out of the select group I watch based on their price wobbling. I have about everything front loaded to bag a divi at end of the month through first week of Oct. once they go ex I will look for price drops in other rotation issues that will crank out a divi a month from then.

 

[bobandsherry]

Saw this and thought y'all here may have an interest. JPM preferred with 5.75% yield .

https://seekingalpha.com/article/4206894-jpmorgan-5_75-percent-forever

 

[Coolius]

Bob, I bought a few hundred shares of JPMLL at $25.00. A strong company and giving me a steady & reliable income stream of 5.7%.

 

[bobandsherry]

Bob, I bought a few hundred shares of JPMLL at $25.00. A strong company and giving me a steady & reliable income stream of 5.7%.

I'm big believer in JPM, worked there my entire career when you figure in all the various mergers and acquisitions. I'm big in JPM common and have done well. Hate to put more eggs into that basket, but having had the ability to look from inside there's nothing that currently gives me concern on % of my net worth in JPM.

Longer term my concern is who will succeed Dimon. Those who were thought to be the heir apparent have moved on, and quiet frankly the names on the current short list don't give me a lot of confidence. I've worked under a couple of them.

I don't feel the preferred div would ever be at risk, but common price may take a hit depending on who is successor. For first time I'm thinking about how to unwind some of my JPM holdings in next 3-5 years to reduce exposure should I think wrong person gets the big chair. Moving to the preferred has been on my radar, this issue caught my eye.

 

[Freedom56]

I used to own JPM-H but it was one of the preferred's I purged back in December at over $27 and change. I bought it just below $24 back in August 2015. I think the new issue is overpriced. I would be a buyer of JPM-H below par. Jamie Dimon made me a lot of money in the early 2000 with Bank One. He is a great CEO and JPM is a solid bank. What I don't understand is why the called a 5.25% preferred not to long ago and issued one at a higher coupon.

 

[bobandsherry]

GLP-A trading at $25.40 today, down from over $26 in past month. Rise in Treasuries shouldn't be moving this one by that much. I took another bite.

 

[Mulligan]

GLP-A trading at $25.40 today, down from over $26 in past month. Rise in Treasuries shouldn't be moving this one by that much. I took another bite.

I had an too oversized position when I bought 24.80 sold all but 400 at 26 a little while back.And rolled big back into NSS around 25.70...Will just sit and hold the rest of my GLP-A. The trend is still good for GLP, we just need to monitor. I flipped my GLIBP for 71 cents holding a couple weeks. I went back in with ASRVP at 28.08 and .10...I just make too much money flipping these...I love the 52 cent interest payment going ex end of month and paying the very next day.

 

[bobandsherry]

I had an too oversized position when I bought 24.80 sold all but 400 at 26 a little while back.And rolled big back into NSS around 25.70...Will just sit and hold the rest of my GLP-A. The trend is still good for GLP, we just need to monitor. I flipped my GLIBP for 71 cents holding a couple weeks. I went back in with ASRVP at 28.08 and .10...I just make too much money flipping these...I love the 52 cent interest payment going ex end of month and paying the very next day.

You should get a job a McD's for as much as you flip lately Yeah, not seeing anything negative on GLP, so much just be people like you taking the money from spike on the issue and saying thanks.

 

[Mulligan]

You should get a job a McD's for as much as you flip lately Yeah, not seeing anything negative on GLP, so much just be people like you taking the money from spike on the issue and saying thanks.

Bob, Im a small potato McD flipper. Holding a 1000 shares of a company with B2 debt is just too much risk for me. 400 I own is still plenty of action for me, lol... Yes I was hoping for quick run out of the gate so it worked..Actually kind of surprised it has dipped considering its generous yield and stable finances. I still like it just need to stay proportional.

 

[bobandsherry]

Bob, Im a small potato McD flipper. Holding a 1000 shares of a company with B2 debt is just too much risk for me. 400 I own is still plenty of action for me, lol... Yes I was hoping for quick run out of the gate so it worked..Actually kind of surprised it has dipped considering its generous yield and stable finances. I still like it just need to stay proportional.

Yup, spreading the wealth is a good way to keep out of trouble.

 

[Coolius]

Today has not been a good day for my portfolio - almost all red on my screen. Tough day, for sure, for income issues.



Someone got the spooks, and dumped IPWLK down to $100.51 on 200 shares.


I quickly put in a bid at $100.52, but now it has gone back up to $103.90.
Maybe another frightened seller will emerge later.

 

[Slow But Steady]

I bought the IPWLK at $103.90. Actually just taking the opportunity to move from one account to another.

 

[Coolius]

I bought the IPWLK at $103.90. Actually just taking the opportunity to move from one account to another.

I am thinking this interest rate scare will dissipate with next week's rate hike - but who knows what the Feds will say at that time?


Income is my objective, and though painful to see NAV decline, it does not impact the income stream. Easy to say, but hard to remain detached when seeing so much red on the screen.