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

Yea, I know all that. Just that Mulligan is usually finding his gems trading at or below par and still rakes in the divy. Just look at what he's shared with us on prices he's paid recently or MTB-, just seemed outside his usual trading to pay up for the divy.

Bob, the AmTrust issue might be a great long term hold, and I probably chickened out way too soon as I suspect more meat is on the bone. But if you cant “trust” a company with the word trust in its name, I guess I shouldnt have bought to begin with, lol.. I guess its more of a gambling thing...But then I chicken out later and go eat the steak dinner with the money, ha.

I think what it really boils down to is I am not a good person to buy distressed issues. I always assume I will be screwed. But the big cap gains if one wants almost need to go in these weeds to get them.

 

[Mulligan]

MTB- and MTB-C represent a huge percentage of my investment money...This is wrong on so many levels. But it wont stay that way indefinitely. As also some of my flipping money is parked here also. I just dont see a lot of relative values in much of what I personally will invest in. It doesnt mean there arent any. I just means I am close minded and unwillingly to consider them. The MTB preferreds are going to trade pretty tight to par outside of any market craziness. The market knows this is a strong candidate for redemption due to its unique cumulative nature. I think yearly capital plans are submitted in summer. If it is to be redeemed that would seem a possible time around there.
I find it odd in their 10-K filings they mention the possible redemption dates for their other non market exchange preferreds. But describe, yet never mentioned P and C’s redemption dates even prior to it occurring.

 

[Winemaker]

Bob, the AmTrust issue might be a great long term hold, and I probably chickened out way too soon as I suspect more meat is on the bone. But if you cant “trust” a company with the word trust in its name, I guess I shouldnt have bought to begin with, lol.. I guess its more of a gambling thing....

I'm trying to decide whether I get "suckered" into a "great" buy, or a "sucker's" bet that will "grate" on me for a long time.

 

[Mulligan]

Winemaker, your history suggests you have more patience to let this play out than I do. I chicken out to easily. Which makes me question where I got the nerve to even buy it in the first place, lol.

 

[bobandsherry]

Winemaker, your history suggests you have more patience to let this play out than I do. I chicken out to easily. Which makes me question where I got the nerve to even buy it in the first place, lol.

Now you know why I said what I did....

Like that is so unlike you, buy MTB- and then this? Like opposite ends of the spectrum

But I thought you said you liked a little of the "nasty" high risk/reward stuff. Didn't find anything that said this was being brought behind the barn to be shot and buried. I think you are just addicted to buying MTB-, which probably isn't a bad thing as the only downside is the risk of rising rates.

 

[Mulligan]

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

Now you know why I said what I did....



But I thought you said you liked a little of the "nasty" high risk/reward stuff. Didn't find anything that said this was being brought behind the barn to be shot and buried. I think you are just addicted to buying MTB-, which probably isn't a bad thing as the only downside is the risk of rising rates.

Bob, my definition of nasty probably changes daily, lol. I have PFX...A blind trading delisted baby bond yielding over 10%...Thats pretty nasty!
I have a decent chunk of SCE-L and G.... Possible four billion in fire liabilities already and just one spark away from billions more....Thats nasty too!
Own an oversized position in EBBNF and EBRGF. Been pleased so far...But these trade blind, and there is currency risk in one, and company cash flow risk in converting dividends to the other... I got a lot on the plate right there for me....On a sober day anyways, ha!

 

[NgineER]

Picked up some MTB-C at $1010 today - slowly moving my cash into preferreds. Counting it as buying under par as the dividend cut off date is in a couple of days.

 

[Texas Proud]

WOW... 21% for AFSI-A (or whatever ticker it is under)....


If it drops a bit more might buy a small amount and hope and pray...

 

[Mulligan]

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

Picked up some MTB-C at $1010 today - slowly moving my cash into preferreds. Counting it as buying under par as the dividend cut off date is in a couple of days.

Ngine...Congrats, I think you made a nice conservative play. For the safety, the QDI yield is about as high as one can get now... And buying in effect under par as you stated ensures if it is redeemed next quarter you make easy safe money...This is just a guess, but I suspect it lives on until summer or next Fall. As these preferreds are in their yearly capital plans that must be submitted to Feds. So they will be here until next years plan takes effect of close to it...And the yield is such they may leave them outstanding also.
Bought my 3 rd canadian reset preferred today. ERRAF. Very pleased with this one buying 500 shares at $15.41. Emera owns quite a few regulated utilities in US. Unlike EBBNF, this one is like my other Canadian Ute EBRGF in that the yield and payment is in Canadian currency and 5 yr Canadian bond. Issued in 2012, its first 5 year reset occurred in August 2018 then it will reset in August 2023.

 

[bobandsherry]

WOW... 21% for AFSI-A (or whatever ticker it is under)....


If it drops a bit more might buy a small amount and hope and pray...

When one has to hope and pray, sounds more like gambling than investing. There's a place for both I guess, just look at how popular Vegas is

 

[Mulligan]

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

When one has to hope and pray, sounds more like gambling than investing. There's a place for both I guess, just look at how popular Vegas is

Bob, you are so mischievous and ornery .....You suggest its a casino play to even invest in it, to Texas; then “chastise” me for not staying in the trade longer.....For the same company!
Since it is now a dollar lower than I sold for a quick profit, I still could have done worse than sell near $15.50.

 

[bobandsherry]

Bob, you are so mischievous and ornery .....You suggest its a casino play to even invest in it, to Texas; then “chastise” me for not staying in the trade longer.....For the same company!
Since it is now a dollar lower than I sold for a quick profit, I still could have done worse than sell near $15.50.

Hmmm.... I didn't say it was casino play, I just pointed out what Texas said would be considered gambling. And Texas was playing on the preferred's which is a higher flyer vs the AFSS sub notes that you (and I) got into. Same company, but much different issues, wouldn't ya say?

But well played on getting out at a buck higher. Gonna guess there's probably trades in play that followed your lead and decided a buck in the hand is better than $1.80 in the bush

 

[Mulligan]

Hmmm.... I didn't say it was casino play, I just pointed out what Texas said would be considered gambling. And Texas was playing on the preferred's which is a higher flyer vs the AFSS sub notes that you (and I) got into. Same company, but much different issues, wouldn't ya say?



But well played on getting out at a buck higher. Gonna guess there's probably trades in play that followed your lead and decided a buck in the hand is better than $1.80 in the bush

Im just teasing....I hope I have the brains to avoid doing that again.

 

[bobandsherry]

Im just teasing....I hope I have the brains to avoid doing that again.

I know.... [emoji41]

 

[Mulligan]

I know.... [emoji41]

Bob at $14.46 it is so tempting...It is debt....But I dont know who the players are and who is friend or enemy. Covenants can be changed from the debt if approved by majority. Who is the majority now that the float has rolled over. For all I know they could submarine the debt covenants just to make more back on the common down the road..
Preferreds keep roaring back. I havent even paid my cap gain and divi taxes from last year and am racking up more already. Still trade the usual suspects, but I have rolled over my issues quite a bit into some new issues that I havent in years past...EBBNF, EBRGF, ERRAF, SCE-L, SCE-G, NI-B, and CBKPP are ones that were added recently into the fold.

 

[Texas Proud]

When one has to hope and pray, sounds more like gambling than investing. There's a place for both I guess, just look at how popular Vegas is

Well, it is kinda gambling.... gambling that they will continue to pay the divi...



Since it is going private, it takes away a big group of investors as MFs will not touch it... most ordinary folks will not touch it... so there is a limited group that will...


And it would be a small investment... say $5K or so... heck, in my testosterone account I have lost over $6K in a day...


BUT, I will just keep the notes as those will have to be paid if they want to be a going concern...

 

[Mulligan]

Texas, I am not saying its not a great buy....But read the prospectus...A going concern has nothing to do with altering the terms of the baby bond if voted on and approved by majority...Much can be altered with a vote..Now who is the majority and what are they willing to do if they are now in bed with the common holders now.
Now the preferreds....Isnt it amazing this preferred has never missed a payment and next diviis declared already.. But PCG-A trades over a 100% higher and it is now in bankruptcy and hasnt paid a dividend in over a year...Hell the non cumulative Fannie Mae preferreds that have been suspended for over a DECADE have a higher trading price than the AFSi preferreds...What is that saying?
Hopeless or bargain of the year?

 

[bobandsherry]

Preferreds keep roaring back. I havent even paid my cap gain and divi taxes from last year and am racking up more already. Still trade the usual suspects, but I have rolled over my issues quite a bit into some new issues that I havent in years past...EBBNF, EBRGF, ERRAF, SCE-L, SCE-G, NI-B, and CBKPP are ones that were added recently into the fold.

Must be quite a rolodex/watchlist you must keep of all those preferred's.

 

[Mulligan]

Must be quite a rolodex/watchlist you must keep of all those preferred's.

I cant remember where the kitchen is at but I have about 75 tickers memorized in my head front wards and backwards....I can remember tickers....and point spreads, real easy for some reason, lol...

 

[Mulligan]

Well, it is kinda gambling.... gambling that they will continue to pay the divi...



Since it is going private, it takes away a big group of investors as MFs will not touch it... most ordinary folks will not touch it... so there is a limited group that will...


And it would be a small investment... say $5K or so... heck, in my testosterone account I have lost over $6K in a day...


BUT, I will just keep the notes as those will have to be paid if they want to be a going concern...

Texas did you or Bob pick up any AfSI action today? I did something more profitable today, lol...I sold 500 of my HE-U at 26.24 and bought them right back at 26.08. I had a hit on another Canadian reset ute preferred so I had to sell 10 shares of my MTB- at 121 and then with cash in another account bought 10 of twin sister MTB-c at 118... Big money day! I actually was just trying to push a sale to myself but it got intercepted. Saved me $25 so I am not complaining.

 

[Freedom56]

Keep in mind that Amtrust and Maiden Holdings are more than likely a Ponzi scheme. As I have stated before, heed the words of Barron's and stay away from Amtrust and Maiden Holdings. Those preferred stocks are headed for zero. The bad news keeps dripping out slowly. Harry Markopolis may seem eccentric, but his track record is pretty good.

 

[Texas Proud]

Keep in mind that Amtrust and Maiden Holdings are more than likely a Ponzi scheme. As I have stated before, heed the words of Barron's and stay away from Amtrust and Maiden Holdings. Those preferred stocks are headed for zero. The bad news keeps dripping out slowly. Harry Markopolis may seem eccentric, but his track record is pretty good.

I had not seen these articles before.... sounds like a reason to get out...


And I did not take the plunge into the pref.... even though they went up today... might have to take a small hit on this one...

 

[Freedom56]

This was published a while back:

https://www.barrons.com/articles/barrons-warned-you-first-amtrust-sinks-20-on-sec-probe-1491932917

The preferred shares were trading above par at that time. I had both Amtrust and Maiden holdings. I sold them both above par for a gain and have watched them collapse. I would stay away.

 

[NgineER]

I disposed of my AFST holding at a small profit today. Glad to not have it anymore based on the above article.

 

[Freedom56]

I disposed of my AFST holding at a small profit today. Glad to not have it anymore based on the above article.

Think of all the people that ignored the article when at the time of publication in 2017, Amtrust preferred stock was trading at or above par. The rest is history.