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Doug K. Le Du

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  • Goodbye Fed - 2014 Sees Preferred Stock Investors Shed QE Jitters [View article]
    I have operated such a service for many years now called the "CDx3 Notification Service."

    Along with many other features, the CDx3 Notification Service website has a one-click "HotList" that automatically generates a list of the highest quality preferreds that are currently available for less than $25. It updates in real-time and is available to subscribers 24/7.

    The CDx3 Notification Service also provides access to our entire Preferred Stock List database and search engine and includes email alerts when new preferred stocks are introduced, a monthly newsletter that I write, access to the largest and most knowledgeable group of preferred stock investors on planet Earth and much more.

    Our database includes ex-dividend dates, current trade data (last price, volume, yield), quality scores, ratings, company research for each issue, etc. and is downloadable, printable and sortable.

    I also offer a separate subscription program to just my Preferred Stock List database and search engine. The search engine is very robust (19 parameters) and allows you save your own filters for later use.

    To see a side-by-side list of the features offered by my two programs, click here:

    http://bit.ly/1mUvTa7

    To see how subscriber's rate the service, click here:

    http://bit.ly/1mUvTa9

    Thanks for your inquiry.
    Apr 7 02:33 PM | 1 Like Like |Link to Comment
  • Goodbye Fed - 2014 Sees Preferred Stock Investors Shed QE Jitters [View article]
    Remember that the Treasury bonds purchased by the Fed have staggered maturities over many, many years. As those bonds reach those maturity dates, the US Treasury will give the cash back to the Fed as they would any other bond holder (unless the Fed chooses to re-invest). It will be interesting to see what effect, if any, these spread-out redemptions have on the perceptions of investors.

    Thanks for posting.
    Apr 7 01:05 PM | Likes Like |Link to Comment
  • Goodbye Fed - 2014 Sees Preferred Stock Investors Shed QE Jitters [View article]
    The 933 value is the number of traditional, trust, 3rd-party trust and ETDs currently trading. Good to hear from you Bruce.
    Apr 7 12:59 PM | Likes Like |Link to Comment
  • AG Mortgage Preferred Stocks: Opportunities And Risks [View article]
    db- please keep in mind that my SA articles are free and available to the general public so they are going to be less specific than the research I provide for my paying subscribers. If you were a subscriber to my CDx3 Notification Service, would you feel that you were being treated fairly if the information that you had paid a fee to receive was provided here to those who had not paid such a fee?

    Having said that, I think that you will find that my SA articles cover this topic with far more breadth and depth than you can find elsewhere. You can check them out here:

    http://bit.ly/16IV5oQ

    My objective here is to inform preferred stock investors about market trends, events, opportunities and specific issues/companies that I come across in my research. I hope that after you look over the 65 articles that I have written for SA over the last 2.5 years that you will find something to catch your interest.

    Thanks very much for taking the time to post your thoughts.
    Feb 17 01:11 PM | Likes Like |Link to Comment
  • AG Mortgage Preferred Stocks: Opportunities And Risks [View article]
    Thanks for reading my book. I'm glad to hear that you found it worthwhile.

    We are in a 7 percent market right now for CDx3-compliant securities (at the close today, the average CDx3 yield was 6.96%). So any new issues that meet those characteristics will be introduced at a dividend rate (coupon) that is close to 7 percent.

    New preferred stock introductions have been slower than normal over the last several months because many companies raised capital a year ago when rates were lower than they are today. But, since there are plenty of existing CDx3-compliant issues selling below their $25 par values with ample liquidity to pick from, why does it matter that there are fewer new issues than usual?

    During seller's market conditions (high prices, low rates such as what we had a year ago), you buy new issues using the Over-The-Counter wholesale exchange for sub-$25 prices (as many of my articles at the time explained); but there is no need to focus on new issues using the OTC exchange to get sub-$25 prices now. As you point out, we are in a buyer's market for preferred stocks now (higher rates are available for lower prices).

    I'm not sure that I understand your point that being in a buyer's market "...doesn't bode well for stock purchases now." The exact opposite is true (why would you wait for prices to increase before buying?). Now is when you should be adding dividend-paying shares for sub-$25 prices.

    Be careful not to approach an income investment (preferred stocks, bonds) using the thinking and metrics of a value investor (common stock). Income investors earn their money by accumulating dividend-paying shares so they buy when prices drop (below $25). On the other hand, value investors earn their money from a run-up in price, so they do the exact opposite - they sell when prices drop in order to limit their losses. Applying value investor thinking to an income investment will often lead to an undesirable result.

    Income investors buy when there is upward pressure on rates and prices are falling. Sellers sell those shares once rates come back down and prices go back up accordingly. This is why preferred stock investing is long-term investing, taking advantage of the known inverse relationship between rates and prices over time. Doing so allows you to add a capital gain to your dividend income in the meantime.

    Thanks again.

    PS- for unknown reasons, zbg952 has asked me the same question as above dozens of times and posts it with almost every article so I've just stopped answering it (and the other two or three repetitive questions that he asks, none of which are related to the article's topic). I try to be responsive, but taking the time to answer the same question with the same answer over and over and over and over is unfair to the rest of us.
    Feb 13 10:42 PM | Likes Like |Link to Comment
  • AG Mortgage Preferred Stocks: Opportunities And Risks [View article]
    No doubt about it. Until MITT gets some more water under their boat, the risk you and wildside are describing should be considered by prospective buyers. Thanks for posting.
    Feb 13 12:27 PM | Likes Like |Link to Comment
  • AG Mortgage Preferred Stocks: Opportunities And Risks [View article]
    If you check out my SA articles of the last couple of years you will see that I write about market events, companies and preferreds that capture my interest and, hopefully, are of interest to other preferred stock investors. It has been very interesting watching mREITs navigate this environment and MITT seems to do a better job of it than most.

    For our other readers: please don't take the preferred stocks and companies that I write about as any type of recommendation from me. I write about topics that I hope you find interesting. My intention is to inform, rather than advise.

    Thanks John. Always great to hear from you.
    Feb 11 01:02 PM | Likes Like |Link to Comment
  • AG Mortgage Preferred Stocks: Opportunities And Risks [View article]
    I just plugged your criteria into the preferred stock search engine on my CDx3 Notification Service website (my subscription site) and found 124 issues currently trading on U.S. stock exchanges. And yes, some of those were issued since May 2013.

    If buying newly issued preferreds is important to you, you might be interested to know that subscribers to the CDx3 Notification Service receive email alerts whenever a new preferred stock or exchange-traded debt security starts trading on any U.S. exchange (including during its wholesale Over-The-Counter distribution). You can read more about it here (including an example of what the email alerts for new issues look like):
    http://bit.ly/SrRbNO
    Thanks for posting.
    Feb 10 04:02 PM | Likes Like |Link to Comment
  • AG Mortgage Preferred Stocks: Opportunities And Risks [View article]
    It is very interesting to watch this leadership team navigate. And, as you point out, they sure seem to do a better job of it than most. Thanks for posting.
    Feb 10 12:24 PM | Likes Like |Link to Comment
  • AG Mortgage Preferred Stocks: Opportunities And Risks [View article]
    Your great comment reminds us all of the complexities faced by those managing mREITs. At times, it seems to require as much crystal ball gazing and it does technical expertise. Thanks very much.
    Feb 10 12:24 PM | Likes Like |Link to Comment
  • AG Mortgage Preferred Stocks: Opportunities And Risks [View article]
    "Do you have easily understood guidelines for preferred investing that stresses safety in a world where interest rates are eventually going to increase?"

    I've been researching and writing about preferred stocks since 2002. You can see a list of 65 of my articles at SA by clicking here:

    http://bit.ly/16IV5oQ

    Also, my book, Preferred Stock Investing, is now in its fifth edition and is written in plain English for non-experts. I update the book every other year to address the conditions that preferred stock investors will be facing for the ensuing period. The current fifth edition was just published a few months ago and focuses on selecting, buying and selling the highest quality preferred stocks during an increasing rate environment. The book is available in paperback and eBook format here:

    http://bit.ly/19uXTeg

    Thanks for posting.
    Feb 10 12:20 PM | Likes Like |Link to Comment
  • 2013 Delivers Higher Dividend Income At Lower Prices To Preferred Stock Investors [View article]
    Check out these two articles and the data that they present on this topic:

    Oct 14, 2013: "Preferred Stock Or 10-Year Treasury Yield - Something's Got To Give" here: http://seekingalpha.co...

    Mar 4, 2013: "How Well Do Government Money Rates Predict Preferred Stock Dividend Trends?" here: http://seekingalpha.co...

    Thanks for your post.
    Jan 1 04:23 PM | Likes Like |Link to Comment
  • 2013 Delivers Higher Dividend Income At Lower Prices To Preferred Stock Investors [View article]
    PSA has gotten a bit spoiled with their 5.2% issues that were introduced last spring. I read an interview about this new debt issue where Havner commented that he felt that the current rate environment for preferreds was too high (PSA could issue a new, cumulative preferred with an A2 rating for about 6.5% right now). But I have not seen the rate. Maybe another reader can help out on this one. Thanks for posting.
    Jan 1 04:20 PM | Likes Like |Link to Comment
  • 2013 Delivers Higher Dividend Income At Lower Prices To Preferred Stock Investors [View article]
    "...now down 23%"

    Do not treat an income investment (preferreds) like a value investment (common stock). Doing so will lead to undesirable results.

    Value investors make their money on price changes (buy low, sell high) so they sell their shares when prices are falling in order to limit their losses.

    On the other hand, income investors make their money from dividends so they buy more dividend-paying shares when prices are falling...note that this is the exact opposite of what value investors do.

    Why did you sell when you were 23% down? Low prices are a time to buy dividend-paying shares for cheap, not sell. If you sell when prices are low, the implication is that you would wait until prices are high to buy. Why would you do that?

    If you did not actually sell (i.e. you are referring to a value loss on paper, rather than an actual loss), you have not lost anything and are making the mistake of applying the strategy of a value investor to a preferred stock investment.

    As the article states: "Preferred stock investing is long-term investing, taking advantage of the known inverse relationship between rates and prices over time. Buyers purchase their shares when rates are increasing and prices are falling below par. Sellers sell those shares once rates head back down and prices head back up above par, adding a capital gain to the dividend income that you receive in the meantime."

    To see the results since January 2001 of the method I am describing, see the third chart in "Why Falling Prices Should Be Welcomed By Preferred Stock Investors" here:

    http://seekingalpha.co...

    Avoid applying value investing strategies to an income investment.
    Jan 1 02:04 PM | 3 Likes Like |Link to Comment
  • 2013 Delivers Higher Dividend Income At Lower Prices To Preferred Stock Investors [View article]
    I view redeemability as an insurance policy of sorts. This characteristic provides a known principal protection mechanism for those purchasing their shares below par. The value that this aspect of preferred stock investing has will vary for different investors, but I view it as a net positive.

    Glad you enjoyed the article. Thanks very much for taking the time to craft your thoughtful post.
    Jan 1 01:51 PM | 1 Like Like |Link to Comment
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