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

[Winemaker]

I should have been more patient; just picked up another 200 at $24.93, at least evened out all but $2.00 of commission charge.

 

[Mulligan]

I should have been more patient; just picked up another 200 at $24.93, at least evened out all but $2.00 of commission charge.

I bought my "vault limit".... So if I am to buy more, it has to catch a real market downdraft to buy more. As buying anymore would have to be in the flip side of my portfolio. Good catch though, Wine! I thought it may sink this morning in downdraft but it caught its legs again and stabilizing.

 

[Texas Proud]

I actually think it can go a bit lower.... the yield is not as high as some of the others out there that are higher rated...

Now, or course these are not yet callable, so there is that you have to calculate...

I have no money so I would have to sell something... I am not as worried at Mulligan on the calls... I might be wrong in my call, but I do not have a lot of skin in the game and the yields are pretty good...

Might have to do a break even on something since they are above call....

 

[Mulligan]

Texas, I probably dont clarify this enough but the reason I am a bit more concerned is I have over a third of my entire retirement stash in the Amerens that are past call. So if they go down, I will have an excess cash problem. And that isn't even counting some others.. So my concern is probably a bit different than yours would be as you probably operate under some sane prudent manner of diversification that I do not.
This is why I wanted the MNR issue so much being I am already familiar with company. Outside of FIISO, I think all the other dozen or so are all past call.
If you go by true YTC price, I suspect there are not many if any preferreds with as high as yield and safety as MNR. They are just on edge of investment grade if CEO is to be believed. The past calls cant be compared to it as they technically are all negative yield to call if they are trading above par price.

 

[Sunset]

I'm ready to put in some lower bids on it come next week, since it did manage to drop a little below $25 with the good sized stock market dip today.

 

[Mulligan]

I'm ready to put in some lower bids on it come next week, since it did manage to drop a little below $25 with the good sized stock market dip today.

Its certainly possible... The shares coming to market wont be held back as it hits the Big Board by the 13th or earlier I believe. If it comes out on another bad day, there may be opportunities. This is the most exposed the issue will be is at its IPO stage. Mix excess liquidity with a bad market sell off and you never know. Although it did hold up rather well Friday considering. But "runners" may have controlled releases on Friday from letting it spiral. But they cannot sit on them for much longer. I dont really monitor the preferred landscape outside of my own issues, but overall, it was just another ho hum day for me.

 

[Sunset]

Part of the reason I'm ready for next week, is Vanguard decided to do the settlement fund change on the account I was going to use, so the funds were locked up while it processed.
Pretty annoying and they were getting a ton of phone calls about it since it's a systemic change.
It did bug me there was not even an email warning and I'm sure it caught some folks in tight situations.
It affected or will affect anyone with a settlement fund that is not "... Federal ..." .

 

[Running_Man]

Just a word of market sentiment to anyone looking to catch a knife just beginning to fall off a shelf. While it is certainly possible for the market to reverse and go straight back up usually a fall of the magnitude Friday will have pretty good carry through for a week at a minimum. I would give the market Monday and Tuesday to carry further down and develop some real fear

 

[Sunset]

Just a word of market sentiment to anyone looking to catch a knife just beginning to fall off a shelf. While it is certainly possible for the market to reverse and go straight back up usually a fall of the magnitude Friday will have pretty good carry through for a week at a minimum. I would give the market Monday and Tuesday to carry further down and develop some real fear

I recognize it could jump back up on Monday, but taking the view it continues to drop a good amount on Monday and Tuesday, how does that fit into the "carry though for a week at a minimum" ?

Are you suggesting the behavior on M & T, will really determine the rest of the week or two following ?

 

[Mulligan]

Just a word of market sentiment to anyone looking to catch a knife just beginning to fall off a shelf. While it is certainly possible for the market to reverse and go straight back up usually a fall of the magnitude Friday will have pretty good carry through for a week at a minimum. I would give the market Monday and Tuesday to carry further down and develop some real fear

On flipping issues I occasionally get snagged on a call notice, I flip out quickly of issue. On my latest one, I have intentionally waited and left it. I want to provide an extra layer so I do not have too much cash available to buy too quickly like you said. The trouble for me is 2 fold..The liquids that would be vulnerable I am not as familiar with. The
issues that I am familiar would not nearly be as easy to buy on sale as they rarely to never trade anyways. Heck AILNP trades so infrequent it stayed right near par during 08-09 crisis while most issues outside of utility preferreds cratered 50-80%.

 

[Coolius]

Since summer, the media has been screaming crash-crash-crash without letup. Can anyone say that this Friday decline was a surprise? Of course not.

When the big boys want it to go down, they sell, then fire up their robot algos and --- down it goes!!

When they decide its time to buy, they do so, then fire up their robot algos -- up it goes!

We retail types are corks in the sea, bobbing along with the waves and troughs created by the big boys. Totally helpless.

Don't know what's coming down tomorrow, but will sit tight with the income stocks I hold, and hope for the best.

 

[Running_Man]

I was not saying to sell any present positions, but I think when you have the first day in months that is more than 1% down it is likely that the move down will continue, that is just the probability of the history of the market, my comment was on someone looking to buy the odds are there will be significantly lower prices by Wednesday ( I define significant as 2-3 percent or more than the close on Friday or the open on Monday. Let’s review this assumption Wednesday after the markets close!!

 

[Mulligan]

I would tend to go with your guess too. Although with some of my issues they never trade anyways despite what is going on...AILNP my favorite during the 2008-09 crisis that rocked everything was actually UP 6%. Traded about 300 shares during that 2 years so it was VERY active. It has traded ZERO shares in the past 14 months.

 

[Sunset]

RM - that is exactly the what I was looking for, a clarification of the meaning.

My only intent is to buy and Vanguard may force it to be Tuesday or later due to their settlement fund thing.

And I totally understand, nobody can predict the market, so if it pops up Monday, I'll be happy on Friday a couple of orders touched my low bids. If it drops more I'll look for more buying opportunities.

 

[Mulligan]

RM - that is exactly the what I was looking for, a clarification of the meaning.

My only intent is to buy and Vanguard may force it to be Tuesday or later due to their settlement fund thing.

And I totally understand, nobody can predict the market, so if it pops up Monday, I'll be happy on Friday a couple of orders touched my low bids. If it drops more I'll look for more buying opportunities.

Are you sure about that Sunset? I have money in Vanguard under going same process. It still shows in above box that I can use the money to trade. Its just not in the new account yet as the money is settling from a previous trade. But I can use it. It just isnt where it is going to be in a few days due to the conversion.

 

[Sunset]

Are you sure about that Sunset? I have money in Vanguard under going same process. It still shows in above box that I can use the money to trade. Its just not in the new account yet as the money is settling from a previous trade. But I can use it. It just isnt where it is going to be in a few days due to the conversion.

For "my" Vanguard account as of Friday afternoon, it was like below, and there was no use my checking on it until Monday so I have not looked, but this is what it was:

• The settlement money was called a money market fund.
• They now made my settlement fund a federal money market fund.
• The moved the old money market fund to where all the funds are and it shows the full balance of what was the settlement amount.
• The new settlement fund a federal money market fund shows the same amount of money and has a debit of the same amount of money equaling $0.

I asked the vanguard rep what I needed to do to get the $$ back into the settlement fund and she said to sell: the old money market fund

Maybeyou will be lucky and your money will settle into the new federal money market fund and miss the entire process of going into the old to be sold so can go back into the new.

 

[Mulligan]

I dont have it open now, but sounds similar to mine except I have unsettled funds now. But it clearly says I can use it though to trade as of this morning when I checked. I just couldnt sell until the original unsettled money from first transaction clears. So if you wanted something couldnt you sell the old money market fund and then it would go into unsettled funds and then purchase? I know the reason why they are doing this but the process is wonky to me.

 

[Sunset]

I expect when I look at it Monday that the dust will have settled and my settlement fund is showing a plain $0 , and then I will sell the Old money market fund, so it goes back into the settlement fund and I will be free to buy.

I'm not in a rush for this, so that's why I didn't go nuts on the phone with them.

 

[RE2Boys]

In my Vanguard accounts, the only change was the creation of the settlement account using a Federal MM fund. Stock distributions and sales proceeds deposited in, stock purchases withdrawn from.

But they did not transfer money from my old Prime MM funds to the settlement account automatically, I had to initiate the exchange between the funds. Since I also had VG funds where distributions were deposited into Prime, I had to manually go into each fund and change them to go into the settlement account which was my desire.

For my son's Roth brokerage account, he's had the settlement account for months but money is still in the old Prime MM account, he has to initiate the transfer.

May be worth noting that we have not yet opted for the consolidated account where everything is held within the brokerage account, separate accounts for mutual funds and brokerage services.

 

[Running_Man]

OK so the market after about 5 minutes was at 2120 on the S&P500 and the ten year bond yield was at 1.68 percent. Will review final numbers and see how much a delay costs Wednesday night!

 

[Mulligan]

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

I expect when I look at it Monday that the dust will have settled and my settlement fund is showing a plain $0 , and then I will sell the Old money market fund, so it goes back into the settlement fund and I will be free to buy.

I'm not in a rush for this, so that's why I didn't go nuts on the phone with them.

Ok Sunset, explain this to me as I hate to learn anything anymore that I do not want to... Presently in my Vanguard I have Money in my Vanguard Federal Money Market fund and now apparently money also in my Prime Money Market fund... Which one of these funds do I use to trade out of if I want to buy?

 

[RE2Boys]

I know you didn't ask me, but amount available to trade on the order form only indicates the monies in the settlement fund.

Vanguard told me that they will not force you out of the Prime MM fund, it is your choice where you park your money. It is your decision to transfer money from the Prime MM to the settlement fund as you choose.

 

[Mulligan]

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

Thanks Re, but now u get another question....Can I buy out of both accounts or do I have to move into one of them? I really never even paid attention to begin with to know which is the new one...I assume Federal?

 

[Sunset]

Thanks Re, but now u get another question....Can I buy out of both accounts or do I have to move into one of them? I really never even paid attention to begin with to know which is the new one...I assume Federal?

I cannot answer for your account as I don't know the history, but today when I logged into "my" account.

It showed the federal money market settlement = $0

and down below in the listing of all the funds it showed the old money market fund (that used to be the settlement fund) with the full amount of what used to be in the settlement fund. I'm going to call this Oldie fund

So I sold a chunk of that Oldie fund directing the proceeds to go into my settlement fund.

When I refreshed it showed nothing available to trade, so I exited and have not looked back for today. Later I got an email, but I still expect since its a fund that it will only happen at the end of the day.

 

[Mulligan]

Ok SS, your situation mirrors mine. So I need to sell my "oldie funds" and at end day like mutuals it will switch over to the settlement fund. I will try that... I guess my timing of my last sell, just caused the proceeds to fall into federal market fund by coincidence of the sell date.