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Doug K. Le Du

 
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  • Preferred Stock Buyers Change Tactics For Double-Digit Returns [View article]
    This article's analysis was an attempt to measure the effect of OTC pricing on newly introduced preferred stocks. Including Greek shipping companies and upstream oil producers would have measured something entirely different; including them would have measured the effect of specific geopolitical events that occurred during the study period of this analysis which is not what I was after.

    Thanks for posting.

    Jan 7, 2015. 11:59 AM | Likes Like |Link to Comment
  • Preferred Stock Buyers Change Tactics For Double-Digit Returns [View article]
    The approaching call date of GRX-A may explain some of this, but more likely the extremely low daily volume of these two issues is at play here. These two securities are often trading less than 1000 shares per day (no sellers) so the prices are going to be very volatile and will often seem inconsistent.

    Thanks again.
    Jan 6, 2015. 12:05 PM | Likes Like |Link to Comment
  • Preferred Stock Buyers Change Tactics For Double-Digit Returns [View article]
    " Is this condition of remaining below liquidation preference after listing on the exchange (for just the first two or three days after listing) typical in your view?"

    I would not call it typical, but it happens, especially if some geopolitical event takes place (e.g. the early-Oct plunge in oil prices) than changes investor sentiment.

    Thanks for posting.
    Jan 6, 2015. 12:01 PM | Likes Like |Link to Comment
  • Preferred Stock Buyers Change Tactics For Double-Digit Returns [View article]
    You need email alerts of new issues to really make this work. Otherwise, you would have to check for new issues (and their temporary OTC symbols) at least once per day and not too many of us want to spend our time doing so.

    Since new issues will only trade on the OTC for a few days before moving to a retail exchange (NYSE), having access to the temporary OTC trading symbol when distribution starts is only helpful if know about it when it occurs. Having a listing of what the temporary symbol used to be is of no value to this strategy.

    Thanks for reading and posting.
    Jan 6, 2015. 11:48 AM | 1 Like Like |Link to Comment
  • Are Lower Tax Preferred Stock Dividends Really A Better Deal? [View article]
    While I enjoy sharing my preferred stock research here and elsewhere, there are obviously limits to that before my subscribers will get the urge to fry my bacon. Thanks for your post (LOL).
    Dec 3, 2014. 11:43 AM | 1 Like Like |Link to Comment
  • Are Lower Tax Preferred Stock Dividends Really A Better Deal? [View article]
    Yes. They are published on the website of my CDx3 Notification Service, which, as I mentioned in the disclosure section, is my subscription service. You can see a screen shot of what my preferred stock database system looks like here and read about its features in the scrolling box below the screen shot:

    http://bit.ly/SrRbNQ

    The site has several one-click "HotLists" listed across the top of each page where subscribers can see various lists of the highest quality securities in one mouse click. The HotLists include the "Bargain Table" which lists the highest quality issues trading below their $25 par; the highest quality Exchange-Traded Debt Securities, highest quality issues that are call-protected, etc.

    The database updates in real-time so the lists are always current. The list of 21 referred to in the article comes from one of those HotLists.

    Thanks for posting.
    Dec 3, 2014. 11:40 AM | 1 Like Like |Link to Comment
  • Are Lower Tax Preferred Stock Dividends Really A Better Deal? [View article]
    You might have missed the next-to-last paragraph: "And this analysis does not consider the capital gain/loss/call protection/redemption risk that comes with purchasing shares for above-par prices since the extent to which any of those materialize is unknowable"

    You are correct regarding the premium to par considerations, but that topic, and the strategies that surround preferred stock investing during a period of low rates/high prices, would (and has) consumed several other articles. Thanks for posting.
    Dec 3, 2014. 11:32 AM | Likes Like |Link to Comment
  • Are Lower Tax Preferred Stock Dividends Really A Better Deal? [View article]
    Good points Bruce. Figuring out how the QDI treatment fits into one's particular circumstances can be complex. My objective for this article was to highlight the notion that choosing alternatives based on QDI designation alone may not provide the benefit an investor is expecting, exactly for reasons like the one you are pointing out. As always, grinding the numbers, while tedious, is really required for those favoring such securities. Thanks for posting.
    Dec 2, 2014. 01:10 PM | Likes Like |Link to Comment
  • Are Lower Tax Preferred Stock Dividends Really A Better Deal? [View article]
    Good to hear from you Tim. Thanks for reading and posting!
    Dec 2, 2014. 01:03 PM | Likes Like |Link to Comment
  • Are Lower Tax Preferred Stock Dividends Really A Better Deal? [View article]
    Good points W; there is something for everyone at SA which is why the platform has been so successful. Thanks for posting.
    Dec 2, 2014. 01:02 PM | Likes Like |Link to Comment
  • Are Lower Tax Preferred Stock Dividends Really A Better Deal? [View article]
    Sounds like you have crafted a nice portfolio customized to your resources, goals and risk tolerance. Nicely done! Thanks for posting.
    Dec 2, 2014. 01:00 PM | Likes Like |Link to Comment
  • Are Lower Tax Preferred Stock Dividends Really A Better Deal? [View article]
    Thanks very much. You are correct, all of my preferred stock research is original research. You can see my SA articles since Oct 2011 here:

    http://bit.ly/16IV5oQ
    Dec 2, 2014. 12:57 PM | Likes Like |Link to Comment
  • Are Lower Tax Preferred Stock Dividends Really A Better Deal? [View article]
    Good point John. There are many very solid but unrated REIT preferreds available. Thanks for your comment.
    Dec 2, 2014. 12:55 PM | Likes Like |Link to Comment
  • Are Lower Tax Preferred Stock Dividends Really A Better Deal? [View article]
    Glad you enjoyed it. Thanks for taking the time to read and comment.
    Dec 2, 2014. 12:54 PM | Likes Like |Link to Comment
  • Preferred Stock Market Snapshot: Investment Grade Preferred Stocks Available Below $25 [View article]
    The article is intended to provide readers with a sense of what today's preferred stock marketplace has to offer, using a graphical depiction along with some examples, and some commentary regarding how things have changed throughout the year, the reasons why and some current drivers (retail sales, oil).

    As you point out and as noted in the article for HSEA and MHO-A, today's buyers will realize a cap loss in the event of a future call since both of these issues are trading above their $25 par values. But what if that call does not happen? Both of these securities have been callable for one and one-half years now and no call. If the companies were in a position to redeem these securities, why haven't they?

    In the case of MHO-A, the cap loss in the event of a call would be $0.47 which is about one quarter's worth of dividend. Some investors are willing to take that kind of risk for the 9.57 current yield being provided by this security.

    I'm not saying that buying above par is a smart thing to do (in fact, the article specifically says that these are just examples for each quadrant and not in any way to be taken as recommendations). But obviously, given the large number of diamonds seen above the $25 market price in the first chart, plenty of investors are willing to pay above par every day.

    The article's title refers to the 71 investment grade securities that are seen in the green (lower-left) quadrant of the first chart, referred to as the "sweet spot" in the article (investment grade, below $25). See the "Count" column in the table under that chart.

    Thanks for posting!
    Oct 27, 2014. 06:22 PM | Likes Like |Link to Comment
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