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Old 11-24-2021, 08:48 AM   #521
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My good preferreds have been getting redeemed one by one over the last couple of years. I only have a handful left of the 20+ is used to have.

Best time to have bought was March 2020 when everything crashed. I grabbed some CMO-E (now FBRT-E) and WFC-L at great prices. I wish I had bought more.
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Old 11-24-2021, 11:37 AM   #522
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So given the interest rate risk and the fact that I don't monitor my preferreds portfolio closely like Mulligan and some others do, I'm thinking of putting trailing stop loss orders on each position that I have to limit my losses in case there is a spike in interest rates that cause the value of preferreds to go down suddenly.

I'm thinking of doing 5%... so if I have a ticker currently trading at $26.00 then it would stop loss at $24.70 but if the ticker subsequently increases to $26.50 then the stop loss would increase to $25.175.

Thoughts? I chose 5% in part because I didn't want an issue just going ex-dividend to trigger a sale.

Am I overthinking this?
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Old 11-24-2021, 06:01 PM   #523
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PB, That is tough one to answer. I see good and bad points. A one off singular company could suffer a quick fall on a sell dump imbalance trigger your sell, and then recover it back. How would you feel if that happened?
I tend to do opposite and try to snag on quick falloffs, but this time could be different if its a secular downturn.
It depends on what type of issue you bought, but have you considered just trimming something that is high in price and low in yield?
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Old 11-26-2021, 02:07 PM   #524
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Quote:
Originally Posted by brokrken View Post
Looks like Schwab is walking back some of the $0 trades, which will apply to some of the OTC traded preferreds we discuss here.

All US OTC and and Canadian trades will be $6.95 starting Dec 6.
While I'm not a fan of paying for something in the future that is free now, I guess it isn't likely a move that will have much impact on me. But I sure hope it's not an indicator of more moves away from $0 commissions!

My current holdings aren't impacted to any great extent.

SPLP+A NYSE
MNR+C NYSE
SLMNP OTC
CNTHP OTC
CNLPL OTC
DTB NASDAQ
CHSCL NASDAQ
CHSCM NASDAQ
SCHW+J NYSE

brokrken, you mentioned "Schwab is walking back some of the $0 trades." I didn't see anything other than US and Canadian OTC trades mentioned. Did you see anything else that caused you to refer to "some of the $0 trades?"
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Old 11-27-2021, 07:59 AM   #525
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Etrade never dropped to $0 commission for OTC stocks. Those were and are still $6.95
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Old 11-28-2021, 12:32 PM   #526
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Quote:
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While I'm not a fan of paying for something in the future that is free now, I guess it isn't likely a move that will have much impact on me. But I sure hope it's not an indicator of more moves away from $0 commissions!

My current holdings aren't impacted to any great extent.

SPLP+A NYSE
MNR+C NYSE
SLMNP OTC
CNTHP OTC
CNLPL OTC
DTB NASDAQ
CHSCL NASDAQ
CHSCM NASDAQ
SCHW+J NYSE

brokrken, you mentioned "Schwab is walking back some of the $0 trades." I didn't see anything other than US and Canadian OTC trades mentioned. Did you see anything else that caused you to refer to "some of the $0 trades?"
youbet, no, that's all I saw referenced. But, like you, I hope it's not a sign of things to come.
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Old 12-02-2021, 05:56 PM   #527
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What's gong on with QRTEP? It's been in a steady downtrend from $108 to $103.
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Old 12-04-2021, 08:29 AM   #528
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What's gong on with QRTEP? It's been in a steady downtrend from $108 to $103.


They have had a few supply issues, but the major event was another huge special dividend given to common stock holders. This didnt help the common either. They are basically telling market most of free cash flow will be returned to shareholders. They are fine keeping company leveraged. I lightened up here a few weeks ago, but still keeping 150 shares.
The preferred market in general has been soft lately too so that hasnt helped either.
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Old 12-04-2021, 10:50 AM   #529
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They have had a few supply issues, but the major event was another huge special dividend given to common stock holders. This didnt help the common either. They are basically telling market most of free cash flow will be returned to shareholders. They are fine keeping company leveraged. I lightened up here a few weeks ago, but still keeping 150 shares.
The preferred market in general has been soft lately too so that hasnt helped either.
Thanks for the explanation.
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Old 12-04-2021, 01:05 PM   #530
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What's gong on with QRTEP? It's been in a steady downtrend from $108 to $103.
Perhaps some folks that have $10K to invest decided to buy the treasury I bond as 7% with zero risk is better than less than 7.7% with risk.
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Old 12-04-2021, 01:07 PM   #531
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Perhaps some folks that have $10K to invest decided to buy the treasury I bond as 7% with zero risk is better than less than 7.7% with risk.
Could be, but that 7% is only for 6 months. (maybe they don't know that?)
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Old 12-04-2021, 02:51 PM   #532
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Could be, but that 7% is only for 6 months. (maybe they don't know that?)
The guarantee is only 6 months, but could be same, higher or lower the next 6 months and every 6 after that. So who knows. Talk of hyper inflation, so who knows what the future rates may be.
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Old 12-04-2021, 03:08 PM   #533
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The guarantee is only 6 months, but could be same, higher or lower the next 6 months and every 6 after that. So who knows. Talk of hyper inflation, so who knows what the future rates may be.
Lots of talk about perhaps sustained high inflation (high by historical standards) but haven't heard anything I'd consider even a tiny bit creditable regarding "hyperinflation." And I sure hope the lack of talk is a good predictor. 50% - 100% - 1000% inflation would make the 4% - 6% rate on my preferred's look kinda pathetic!

From Wikipedia:

Quote:
Hyperinflation is a term to describe rapid, excessive, and out-of-control general price increases in an economy. While inflation is a measure of the pace of rising prices for goods and services, hyperinflation is rapidly rising inflation, typically measuring more than 50% per month.
Of course, hyperinflation is possible. It's happened in other countries several times in modern history. Let's hope not here..........
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Old 12-04-2021, 03:15 PM   #534
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Lots of talk about perhaps sustained high inflation (high by historical standards) but haven't heard anything I'd consider even a tiny bit creditable regarding "hyper inflation." And I sure hope the lack of talk is a good predictor. 50% - 100% - 1000% inflation would make the 4% - 6% rate on my preferred's look kinda pathetic!
Who can say what a credible source is these days..... Transitory was the buzzword from credible sources, well until last week anyway. Lol. I don't buy into the hyper myself, but did anyone think 7% Ibond rate was possible 6 months ago?
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Old 12-04-2021, 03:18 PM   #535
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Who can say what a credible source is these days..... Transitory was the buzzword from credible sources, well until last week anyway. Lol. I don't buy into the hyper myself, but did anyone think 7% Ibond rate was possible 6 months ago?
I thought Ibond rates could go there. That was just based on thinking that inflation could very well reach current levels with the Fed saying they were targeting levels above 2% to achieve an average of 2%+ going forward. Couple that with COVID and stimulative spending and I'm a bit surprised inflation rates aren't even higher today. Not hyper-high, but back to the late 70's level of "high."

It does sound like the politicians have gotten the message that the public doesn't like what's happening with inflation now so I'm not surprised to see the Fed backing away from such pro-inflation rhetoric. Now, let's see what happens........
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Old 12-04-2021, 03:25 PM   #536
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Where did ya see someone predicting or even talking about hyperinflation in the USA?
A few "experts" on various shows have spoke the word. Don't know if Mr Wonderful is an expert, just a rich dude, but he whispered that word just recently.

https://www.cnbc.com/2021/11/23/kevi...inflation.html

And don't know if Jack Dorsey is an expert (another really rich dude), but he mentioned it too about a month ago.

https://fortune.com/2021/10/25/jack-...yperinflation/

So dribs and drabs here and there for sure.
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Old 12-04-2021, 04:19 PM   #537
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A few "experts" on various shows have spoke the word. Don't know if Mr Wonderful is an expert, just a rich dude, but he whispered that word just recently.

https://www.cnbc.com/2021/11/23/kevi...inflation.html

And don't know if Jack Dorsey is an expert (another really rich dude), but he mentioned it too about a month ago.

https://fortune.com/2021/10/25/jack-...yperinflation/

So dribs and drabs here and there for sure.
I wouldn't give much credit to those two! OTOH, treading carefully to not step on a political landmine, there does seem to be a trend towards viewing inflation as desirable in Washington, until the voter push-back that is.

Oh well. This isn't an inflation thread beyond the fact that taking on the risk of preferred stocks to gain higher interest rates that are just barely, or perhaps not, keeping up with inflation takes some of the fun out of the game.
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Old 12-04-2021, 09:31 PM   #538
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Perhaps some folks that have $10K to invest decided to buy the treasury I bond as 7% with zero risk is better than less than 7.7% with risk.


I owned IBonds for a few years about 10 years ago then sold when rates got really low…But this time around, I liked them so much, I bought 10k of them and then decided I would ignore the limit and buy 10k more. Come January I will buy 10k more. I bought in September so I am on 3.56% for 6 months, then I will get the 7.12% afterwards.
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Old 12-04-2021, 11:22 PM   #539
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Considering that the fixed rate portion of an I Bond is zero I do not think I will buy any...


I have preferred shares that are tied to LIBOR and usually LIBOR goes up if there is inflation... and my fixed is like 5 to 6%....
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Old 12-04-2021, 11:33 PM   #540
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I owned IBonds for a few years about 10 years ago then sold when rates got really low…But this time around, I liked them so much, I bought 10k of them and then decided I would ignore the limit and buy 10k more. Come January I will buy 10k more. I bought in September so I am on 3.56% for 6 months, then I will get the 7.12% afterwards.
You could overpay the feds some estimated taxes to earn a $5K refund and have it returned as I-bonds.

Allowing a person to get a legitimate $15K in I-bonds each year.
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