Seeking Alpha

Delta_Neutral

 
View as an RSS Feed
View Delta_Neutral's Comments BY TICKER:
Latest  |  Highest rated
  • MORL Projected To Pay September Monthly Dividend Of $0.0762, For 21.9% Yield [View article]
    10 year yields are in a downward channel, currently 2.34% yield. This is bullish for mREITs & also bullish for the book value of the mREITS. Unrealized gains or losses on MBS holdings are hardly ever realized because when they mature, they are typically redeemed at par. I would squarely focus on short-term rates, like repos and the 1 month T-Bill for hints of the spread narrowing.
    Aug 28 02:54 PM | Likes Like |Link to Comment
  • Signs Of An Approaching Bear Market [View article]
    You neglected to mention 10-year Treasury Bonds to support your thesis. On Friday, the 10-year hit a fresh 52 week low of 2.302%. This typically implies fear as investors shift out of equities. Good article nonetheless. Also, what does Income Inequality have to do with a bear market? Wouldn't that just mean that there are only about ~2000 people in the US that control the entire financial destiny of ~320MM people with there purchasing and investing habits? Agree with wage stagnation.
    Aug 16 11:34 PM | Likes Like |Link to Comment
  • Career Curveballs: My Worst Trade -- And What It Taught Me [View article]
    stay thirsty my friends. keep learning and mitigating risks.
    Aug 15 01:07 AM | Likes Like |Link to Comment
  • MORL August Dividend Precisely My Prediction - mREITs Will Benefit From Attitude Shifts [View article]
    NRZ is the best in breed. it now sports a 12% dividend yield and is inelastic to lower rates. in fact, it gains in value when rates rise. 60% of their portfolio is vested in Mortgage Servicing Rights with the rest in MBS'. MSR' increase in value with a rise in rates & decrease in prepayments.
    Aug 13 01:17 AM | Likes Like |Link to Comment
  • MORL August Dividend Precisely My Prediction - mREITs Will Benefit From Attitude Shifts [View article]
    NRZ' ROE was 25% +. NLY was barely 10%. Who's winning ?
    Aug 8 12:47 AM | Likes Like |Link to Comment
  • MORL August Dividend Precisely My Prediction - mREITs Will Benefit From Attitude Shifts [View article]
    I like NRZ, New Residential. They make money in a stable or increasing rate environment. If they can't leverage up there servicing rights they can leverage with Agency MBS'. MSR's tend to yield 12%+/ With rates likely to increase in the next few years look for NRZ to show a very high ROE.
    Aug 6 02:24 AM | Likes Like |Link to Comment
  • CEFL August Dividend Projected To Bring Yield To 18.4% [View article]
    Look, as the SPY goes so does CEFL. This is the wrong time to buy CEFL. When the SPY corrects 10%, this will be down 20% or so.
    Aug 5 02:34 AM | Likes Like |Link to Comment
  • MORL Is A 'Too Good To Be True' Investment [View article]
    My top picks are REM (1x leverage not quite as volatile), MORL (smaller percentage allocated), and NRZ (because it will make money in a up or down market). All on DRIP. $100K with DRIP on, would be worth ~$370K in 10 years. Plus dividend would technically keep increasing because your base is also increasing.
    Jul 28 11:10 PM | Likes Like |Link to Comment
  • MORL Is A 'Too Good To Be True' Investment [View article]
    I think a component such as NRZ is selling above book value because they hold MSR's which contain significant value that have yet to be realized. There is no exchange traded markets for these assets and they are evaluated based as Level 3 Inputs —"Valuations based significantly on unobservable inputs". With a rate hike on the horizon, I believe these are grossly undervalued.
    The NRZ Servicer Advance portfolio currently yields 4.4%; there Excess MSR's are yielding 12.5%.
    Holding NRZ as an individual component (yielding 11%+) with MORL is a far more effective hedge against rising rates, than holding AGNC which is biased towards a complacent/declining rate environment.
    Jul 28 12:51 AM | Likes Like |Link to Comment
  • MORL Is A 'Too Good To Be True' Investment [View article]
    and the reason for that is, some of the components such as TWO and NRZ hold Mortgage Servicing Rights. These actually gain in value when rates rise and can be thought of as a monthly annuity. The increase in value is due to a decrease in prepayments once rates rise due to less refinancing. They should yield upwards of 10% for each MSR held.
    Jul 28 12:37 AM | 1 Like Like |Link to Comment
  • CEFL August Dividend Projected To Bring Yield To 18.4% [View article]
    If you overlay the SPY vs. CEFL, YTD, you will see a very strong positive correlation. +8.25% SPY vs. +9.68% CEFL. This tells me if we get a correction or bear market this ETN will get obliterated. This should make people hesitant to hold for an extended time period as the composition of the closed-end funds are likely long-only. Any thoughts on this?
    Jul 24 01:51 AM | Likes Like |Link to Comment
  • Should You Invest In UBS ETRACS Monthly Pay 2xLeveraged Mortgage REIT ETN? [View article]
    what do you think of New Residential, NRZ? They focus on MSR's as annuity streams. They are supposed to be a hedge when rates rise.
    Jul 24 01:23 AM | Likes Like |Link to Comment
  • Should You Invest In UBS ETRACS Monthly Pay 2xLeveraged Mortgage REIT ETN? [View article]
    what do you think of ownership in just NRZ?
    Jul 23 12:41 AM | Likes Like |Link to Comment
  • MORL Is A 'Too Good To Be True' Investment [View article]
    Confused about what a Servicing Advance is and how it works for mREIT's that invest in MSR's.
    The textbook definition of a "Servicing Advance" is "loans extended by residential mortgage servicers to cover payments missed by homeowners".
    How does one invest in the "advance" and how are the cash flows determined? For example, is NRZ actually providing the loans for the Servicing Advance or just investing in it? How would they make a "profit" if they are just providing the loan advance? Wouldn't this just be the basic fee component of the MSR? And don't you only make your "profit" on the excess MSR?

    Can you invest in an Excess MSR independently from a Basic MSR? Or you must invest in both MSR's together?

    "NRZ receives cash flows from advance recoveries and the basic fee component of the related MSRs."
    Jul 22 11:16 AM | Likes Like |Link to Comment
  • 2 Quick Plays To Hedge Your Portfolio Against Rising Rates [View article]
    Confused about what a Servicing Advance is and how it works for NRZ's bottom line.
    The textbook definition of a "Servicing Advance" is "loans extended by residential mortgage servicers to cover payments missed by homeowners".
    How does one invest in the "advance" and how are the cash flows determined? For example, is NRZ actually providing the loans for the Servicing Advance or just investing in it? How would they make a "profit" if they are just providing the loan advance? Wouldn't this just be the basic fee component of the MSR? And don't you only make your "profit" on the excess MSR?

    Can you invest in an Excess MSR independently from a Basic MSR? Or you must invest in both MSR's together?

    "NRZ receives cash flows from advance recoveries and the basic fee component of the related MSRs."

    12/31/13
    Principal and interest advances $ 1,516,715
    Escrow advances (taxes and insurance advances) 934,525
    Foreclosure advances 209,890
    Total $ 2,661,130
    Jul 21 11:05 PM | Likes Like |Link to Comment
COMMENTS STATS
157 Comments
88 Likes