Generate 8% Yield On These Blue Chip Names [View article]
BuyandHold - thanks for the comment. I understand your concerns. I really think that with some simple education the most conservative investors can leverage options in their portfolio. My guess is that your friend lost a lot of money from selling naked options (either puts or calls). My guess is that they got enamored with the idea of collecting premium for "free" from selling out of the money calls and puts. These guys probably said these options will never exercise.... and they did.
Selling naked is an easy way to get stream rolled. The industry term is picking up nickels in front of a stream roller. You have to find the right strategy for you. The covered call strategy is pretty conservative. Investors can lose on "opportunity cost" from the stock going much higher while you capped the upside.
Best of Luck. I suggest you really questioning your friend on their strategy and picking up a book to educate yourself because everyone can benefit.
Thanks for all the comments. I appreciate the debate. A healthy and productive debate is what makes a market. I have owned NLY, AGNC, and MFA (non agency). I moved to the sidelines as to what I believe to be risks to the dividend and potential funding issues with a banking crisis. While I think NLY and MFA are the best of the lot, I rather move to the sidelines with my capital. Thanks again for the comments. If NLY falls below book value (~0.8x) I would look to buy back in.
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I like NLY, AGNC, MFA, and TWO. All these REITs have different strategies so listening to all the conference calls and reading the Ks and Qs is important. In terms of NLY and MFA the tenure of the mgmt team (internally managed) are comforting. For AGNC and TWO - I like the specific strategies. thanks.
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Did folks actually read or listen to the transcript? He simply asked a few clarifying questions. People do not seem like they completed any diligence before jumping in on the shortside. Einhorn presented 130 pages of slides with short and long positions from France to appl. I would guess he doesn't have a firm view long or short. Asking questions is doing diligence. Think others could benefit from the tactic.
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Not necessarily a particular reason any specific names have been left off. But when I look at these M REITs I am looking for management teams that have operated successfully over a number of years. In addition, I prefer internally managed (e.g. MFA). Reviewing the specific strategy (AGNC / TWO - low balance strategy) is also important. Most of these trade around book so the managers and strategy are the most important factor.
Diversify Your mREIT Portfolio Using Both Agency And Non-Agency Entities [View article]
Given the low cost of commissions today, I think investors can create a decently diverse set of names in the space. I would opt for greater exposure to MFA, TWO, MTGE (non agencies). I would also pass on CIM.
Generate 8% Yield On These Blue Chip Names [View article]
Selling naked is an easy way to get stream rolled. The industry term is picking up nickels in front of a stream roller. You have to find the right strategy for you. The covered call strategy is pretty conservative. Investors can lose on "opportunity cost" from the stock going much higher while you capped the upside.
Best of Luck. I suggest you really questioning your friend on their strategy and picking up a book to educate yourself because everyone can benefit.
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You seem to not like REITs generally.
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