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

[RicDee]

Does anybody own any “Buy and Holds” that are now in buying range?

 

[brokrken]

Does anybody own any “Buy and Holds” that are now in buying range?

Unfortunately, I don't see any at the moment. "buy and holds" are at a premium these days.

 

[Coolius]

Most Preferred issues are strong lately, I am watching and waiting. Not a lot of opportunity to buy recently.

 

[RicDee]

Thanks for the replies.
If you do buy, would you please post it.

 

[Mulligan]

I got in on RLJ-A on Thursday at 25.09 and 25.10. Its already jumped to 25.50.

 

[bobandsherry]

I got in on RLJ-A on Thursday at 25.09 and 25.10. Its already jumped to 25.50.

Heh, I jumped in on RLJ-A as well, but paid 2 cent more premium than you did. I've been moving more of my "play" account to preferred holdings. I looked that DOW/S&P gave me a nice run and looked that 7-8% return is good place to pull some of the recent "wins".

Right now I'm holding AHT-F (bought early Feb for just over $20 and already have 8% gain), CHMI-B, CIM-D, GLP-A, GMLPP, NSS, and RLJ-A.

 

[Mulligan]

Heh, I jumped in on RLJ-A as well, but paid 2 cent more premium than you did. I've been moving more of my "play" account to preferred holdings. I looked that DOW/S&P gave me a nice run and looked that 7-8% return is good place to pull some of the recent "wins".

Right now I'm holding AHT-F (bought early Feb for just over $20 and already have 8% gain), CHMI-B, CIM-D, GLP-A, GMLPP, NSS, and RLJ-A.

I dont know if I will hold, Bob, but the price was right. Its really not bad for a hospitality reit. My float has really turned over. My biggest holding is now EBGEF which will roll into over 6..7% yield on my recent purchase price of about $19.80 for this BBB- issue. Over a third of my shares now in various Canadian resets though a lot is still US currency based despite trading on TSX.

 

[bobandsherry]

I dont know if I will hold, Bob, but the price was right. Its really not bad for a hospitality reit. My float has really turned over. My biggest holding is now EBGEF which will roll into over 6..7% yield on my recent purchase price of about $19.80 for this BBB- issue. Over a third of my shares now in various Canadian resets though a lot is still US currency based despite trading on TSX.

I've looked and see no online option through either of my broker accounts to dip into EBGEF as neither shows that as valid ticker, most likely due to only trading on a Canadian exchange.

My other trades have mostly been around a common stock so outside the subject of this thread. Similar to opportunity you've found with a couple of preferred issues, it's had good price movement, trades the past month have given CG that is more than a year of dividends, plus also pocketed a dividend payment (4.5%, so not bad for income holding). I'm back into it after another dip today. But looking for good buy on a preferred to put the money when I can churn a trade again.

 

[Mulligan]

That is odd, Bob. EBGEF is actually the US OTC ticker symbol for the issue. Its the Enbridge Series 5 issue. It pays USD to avoid currency issues. Yes, USD on the Canadian exchange. It just became tradable on OTC last week. It just complete first 5 year reset effective Mar. 1. I bought through TD and Vanguard with no problems. I suspect your brokerage hasnt put ticker in database.

 

[bobandsherry]

That is odd, Bob. EBGEF is actually the US OTC ticker symbol for the issue. Its the Enbridge Series 5 issue. It pays USD to avoid currency issues. Yes, USD on the Canadian exchange. It just became tradable on OTC last week. It just complete first 5 year reset effective Mar. 1. I bought through TD and Vanguard with no problems. I suspect your brokerage hasnt put ticker in database.

I dropped a message to broker, they responded that it's available to trade. Sure enough, it shows there now.

 

[Mulligan]

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

I dropped a message to broker, they responded that it's available to trade. Sure enough, it shows there now.

If interested here are the vitals.
https://www.enbridge.com/~/media/Enb/Documents/Investor Relations/2013/Pref 5 Prospectus.pdf
Here is the official reset notice
https://www.marketwatch.com/press-r...and-announces-reset-dividend-rates-2019-01-30

Remember the 15% holdback you have to file for if owned in taxable. A few people have bought Enbridge preferreds recently and we all just got paid in past few days. I bought in taxable but they did in tax free and said that the treay was followed and no 15% was withheld in their tax free account.

 

[aja8888]

If interested here are the vitals.
https://www.enbridge.com/~/media/Enb/Documents/Investor Relations/2013/Pref 5 Prospectus.pdf
Here is the official reset notice
https://www.marketwatch.com/press-r...and-announces-reset-dividend-rates-2019-01-30

Remember the 15% holdback you have to file for if owned in taxable. A few people have bought Enbridge preferreds recently and we all just got paid in past few days. I bought in taxable but they did in tax free and said that the treay was followed and no 15% was withheld in their tax free account.

In my tax deferred account, the foreign tax was paid on the dividend I received.

 

[Texas Proud]

Well, can not complain about this round trip..


Bought 2000 HJV on 2/19 at 7.35, sold today for 7.35... pocketed $1750 divi

 

[Mulligan]

In my tax deferred account, the foreign tax was paid on the dividend I received.

Enbridge, Aja? That is odd that someone would and someone wouldnt. That would appear to be a brokerage issue. I have pretty much all mine funneled out in taxable. ERRAF withheld it in my Roth. Im still holding them and waiting to get a new brokerage taxable account to move them as I am roadblocked as other brokerages cant trade it..My FTRSF was in tax free and nothing was withheld from it. I just dont want to play the game and eventually getting them all in tax free. The withholding will help pay down my taxes I will owe at end of year for me.

 

[Mulligan]

Well, can not complain about this round trip..


Bought 2000 HJV on 2/19 at 7.35, sold today for 7.35... pocketed $1750 divi

Gonna play again Texas, or are you leaving the scene of the crime for good?

 

[aja8888]

Enbridge, Aja? That is odd that someone would and someone wouldnt. That would appear to be a brokerage issue. I have pretty much all mine funneled out in taxable. ERRAF withheld it in my Roth. Im still holding them and waiting to get a new brokerage taxable account to move them as I am roadblocked as other brokerages cant trade it..My FTRSF was in tax free and nothing was withheld from it. I just dont want to play the game and eventually getting them all in tax free. The withholding will help pay down my taxes I will owe at end of year for me.

Yes, Enbridge. And in my IRA account at Schwab. Go figure.

 

[pb4uski]

Well, can not complain about this round trip..


Bought 2000 HJV on 2/19 at 7.35, sold today for 7.35... pocketed $1750 divi

So much for market efficiency. Well done, TP.

 

[Mulligan]

If one is sitting on cash, consider buying ALL-E under 25.41. Just went past call at a bloated 6.62% yield. Next divi going exD is end of month. They just declared divi recently with no call announcement. Prospectus states they will only redeem on payment date. So this seems pretty easy to pluck a divi before next possible call.

 

[Freedom56]

If one is sitting on cash, consider buying ALL-E under 25.41. Just went past call at a bloated 6.62% yield. Next divi going exD is end of month. They just declared divi recently with no call announcement. Prospectus states they will only redeem on payment date. So this seems pretty easy to pluck a divi before next possible call.

I'm looking at that one. There aren't too many investment grade preferred bargains. I'm probably going to dump my COF-PD (6.7% QDI). I picked it up just below par in December and collected my first dividend this month. It has call protection until December 2019 and it closed at $26.21. The capital gain would almost cover the next three payments. I could buy something else or float the proceeds in a money market fund yielding 2.3% until the next program induced selloff. I will continue to hold COF-PF, LMHA, and others that are protected through 2020. The best case scenario would be to sell COF-PD above $26.20 and pick up ALL-PE closer to par.

 

[Texas Proud]

Gonna play again Texas, or are you leaving the scene of the crime for good?

I am going to play... I got too aggressive last year and lost about $4,000 the last 5 months... but, I only lost $38 for the year...


Since I started my return is still at 11% excluding this past trade...


I did 33 round trips last year... will look at doing maybe 10 or so this year.. just have been busy dealing with other stuff and it takes a bit of time and effort to flip on a regular basis...

 

[Mulligan]

I'm looking at that one. There aren't too many investment grade preferred bargains. I'm probably going to dump my COF-PD (6.7% QDI). I picked it up just below par in December and collected my first dividend this month. It has call protection until December 2019 and it closed at $26.21. The capital gain would almost cover the next three payments. I could buy something else or float the proceeds in a money market fund yielding 2.3% until the next program induced selloff. I will continue to hold COF-PF, LMHA, and others that are protected through 2020. The best case scenario would be to sell COF-PD above $26.20 and pick up ALL-PE closer to par.

Freedom, Im afraid I may have hit a dry hole here. I guess I will know soon. I am not used to companies announcing their divi late and then slapping a quick call notice on me. I found out All State did this last fall. Three days after declaring. I didnt know that. So it really has to survive another week. And as stiff as the price has been right on divi plus par, that may be a telling sign. I know its a DOA issue but was trying to sneak in a quick divi before a redemption.

 

[Freedom56]

Freedom, Im afraid I may have hit a dry hole here. I guess I will know soon. I am not used to companies announcing their divi late and then slapping a quick call notice on me. I found out All State did this last fall. Three days after declaring. I didnt know that. So it really has to survive another week. And as stiff as the price has been right on divi plus par, that may be a telling sign. I know its a DOA issue but was trying to sneak in a quick divi before a redemption.

Mulligan,

I dumped 4000 shares of COF-PD today at $26.155. Including the 42 cent dividend received last Friday, my gain is $1.58/share vs the 1.68 I would receive in dividends if I held it to December 2019. I am assuming that the will call this preferred for December 1st. I invested the proceed in a money market fund at 2.38% until I find something else. There will likely be another program driven sell-off that will allow me to jump into some QDI preferred stocks below par and yielding about 6.5%-6.7%.

2019 is going to be a year of navigating through minefields in both equity and fixed income markets. Many companies are going to deleverage at the expense of common shareholders. Many companies just won't have the operating income to cover their interest payments at the expense of bond holders. Many preferred stocks will be going to zero.

I am going to err on the side of caution this year and only buy when there is mass program selling and float my cash in money market funds. Longer term, I continue to believe we are headed to new lows on the 10 year note and 30 year bond by the end of 2020 or sooner.

 

[Mulligan]

That is pretty dire prediction, Freedom. I guess it depends on what preferreds you are referencing though. There are none of mine heading to zero though.

 

[Freedom56]

That is pretty dire prediction, Freedom. I guess it depends on what preferreds you are referencing though. There are none of mine heading to zero though.

Maiden holdings, CBL preferred stocks as examples. I noticed that PFF, PGX, SPFF continue to hold CBL preferred stocks. Somebody should let a human intervene in investment decisions for those funds.

 

[Mulligan]

Ya, I nowhere near those type of trainwrecks!