Five Plus Investor

Dividend growth investing, deep value, long-term horizon, preferred shares
Five Plus Investor
Dividend growth investing, deep value, long-term horizon, preferred shares
Contributor since: 2011
@panda - my church has several ministries that go into the prisons to provide counseling, education and encouragement. Churches do this because they take seriously Jesus' words in Matthew 25:36 that when we visit prisoners, it is a high calling, equivalent to ministering to Jesus himself. Given the high rate of recidivism, a donation to a church that does this is, in fact, a form of activism. Just a thought.
Actually, it's DSXN - the ticker symbol (DSX) + N.
@Chuck - that' a great question! What I do is always, always balance my high yield with a counterbalance of ultra-safe low yield. So whatever percentage you put in REITs or BDCs, counter balance with an equivalency of treasuries or TIPs, for example. If you counterbalance with debt, make sure you have sufficient dividend growth in your high yield for inflation protection on your income, or just use lower-yielding dividend champions. As for the remainder of your portfolio, it is really not difficult to locate both stocks and debt instruments that are both safe and yield 4%.
Are you aware of David Fish's CCC list?
As far is this article is concerned, that particular guru was asked only to address preferred shares, not anything else. So while *you* are not talking about senior notes, the article *does*, and his contribution is confined to that niche only.
Hi, varan! Nice to have you back. You loved my articles back in the day. No, really ;-).
The market was down 7.9% for January, so the most likely scenario for *any* portfolio introduced in December 2015, should it follow the market, is...down 8%.
Now, if you are referring to the senior notes this writer talks about, the market price is, at the end of the day, immaterial. Senior notes have a maturity, and the investor will get back the par price at maturity. If bought under par, the investor *does* eventually get a payoff, assuming the company maintains the ability to pay on the debt covenant. I believe this is the reason this writer advises patience...not a bad virtue for any income investor.
So instead of examining portfolio performance of this writer, a better benchmark would be, are the companies he is recommending able to maintain their debt covenants. That is certainly up for scrutiny. Even so, I stand by my choice of "guru".
Take Care,
Denise, a/k/a Five Plus Investor
Excellent advice, thanks Bob. I see you are now a contributor. I will be checking out your articles :-). Take Care, Denise
GIORGIO!! I am glad you found me! You and I need to try to be nice to varan from now on...if we can ;-).
Thanks for commenting!
I am first, and foremost, a mother. Due to multiple crises, my family and businesses needed my full attention for several years. I will never apologize for putting my family first before Seeking Alpha.
I also wanted to come back when I felt strong enough not to get roped into silly arguments on SA. So Larry, I have no ax to grind with you, and I wish you all the best with your investing.
Take Care,
Denise, a/k/a Five Plus Investor
Larry and I go way back. He's a big fan of mine ;-).
If you read the article, even Brad Thomas, who is certainly one of the most prestigious contributors here on SA, said...I made a mistake. We all do. The only way to learn in any aspect of life is...get out there...fall on your face...get back up...learn the lesson. Cut your losses, move forward, invest more wisely, keep learning, keep growing
Lesson for investing. Lesson for life.
Thanks for commenting!
Awww...I would have loved to survey you, Dave, but I did not survey fellow contributors, only readers. Consider it my SA "Iowa caucus".
Thanks! I really feel blessed to have such brainpower on this article! The Fab Five not only contributed, but did so with excellency and enthusiasm. It was a real pleasure working with them. A few of them offer premium products and services, and I encourage you to check these services out, if you are interested.
Thanks for being one of the reader survey contributors!
Hi, Norman! It's great to hear from you again. That's the risk with high yield, and for many, it's not worth it. But if you are in, or near, retirement, getting a yield above 3% is sometimes not just desirable, but necessary.
No one should kick themselves over Linn Energy. Hedgeye was right, and the Linn bulls were wrong. Many analysts were wrong. Many SA contributors were wrong. Very few gave Hedgeye a golf clap, and even fewer took action. Count me, sadly, as one who did not take action before taking a loss. I would feel badly...only I know our numbers are legion.
Since the article consists of mainly advice from other contributors, I will let them weigh in, if they so desire.
Hi, Larry! I've missed you! Thanks for reading my article! I sent an offline poll to select followers and readers last week.
Thanks for the thoughtful reply. I agree with your assessment of bond funds, I don't like them either. For fixed income , prefer bonds and preferred shares, bought under par, with an intermediate term call or maturity. Like you, I am also a big fan of munis. Take Care, Denise
It is refreshing to read an article that isn't about the same old stocks and bonds. So job well done, Psycho Analyst. I think CDs could be an excellent investment...someday. I am wondering...is that day today? Or, perhaps sometime in the future?
I clicked the link that took me to CD rates, and I didn't find any 5 year CDs with an interest rate of 3%. Perhaps there are 10-year CDs with 3%, but would be multiple risks in tying up significant funds this way. As with any fixed rate instrument, you do not obtain inflation protection if you draw out the interest. There is also uncertainty as to future Fed rate increases. Interest rates will go up *someday*. As such, there may be a better day for this safe investment.
IMHO, bonds or preferred shares, for now, may hold more promise of income than a CD. If you can lock in an under par bond or preferred with a reasonable maturity, you get a kicker of principal appreciation when it matures. But years from now, absolutely, a CD could be the way to go.
There is an editorial process at play; contributors don't always have the final say on the title.
Bruce, really good article, adding (O), (WPC), (EPR) and (NNN) to my watch list.
@George - before an investor sells an MLP, it is important to know the tax consequences. Those distributions are only tax-free as long as you hold. When you sell, the tax man reaps all taxes owed on those distributions. So the decision to "lighten up" your exposure on MLPs, for most investors, is a painful one.
It may behoove investors to look outside the oil / gas box on MLPs in the future. At least, diversify. For example, (BIP) and (IEP).
@William - good advice. I am buying nothing during this rally. Probably a lower high, then selling some losers and putting in some shorts.
@Pete - obviously, Mr. Market doesn't know exactly where to hold his shorts, then :-). Pants on the ground, anyone??
@Sleepless - is English your first language? If not, pardon my correction, but it is "bear" and not "bare" market. You just made quite a funny joke in English :-).
@Martin - I wish I would have seen your article sooner. It's January 20th, and your advice, had I read it when you published it and followed through, would have saved me some heartburn. Really ugly market today. At the next relief rally, I am going more cash. Really good article, you have a new follower.
Mike, excellent article. I agree with mbn - quite impressive that almost all your sells made a profit. That tells me, really, you aren't so reluctant, and you may, in fact, be a nimble trader. That's not a bad thing!
Selling also doesn't mean there won't be a day you will buy again. I sold out of GE when they first announced a dividend cut, then re-entered when the stock recovered. Still holding, now my best performer.
Hi, Christine, from a fellow woman on SA :-).
@richjoy - which utilities are you looking at?
RS - I share your unease here. I probably should have sold more when DIA breached 17000, but on the next lower high, I will be selling some losers and maybe play some shorts. However, I personally think anytime is a good time to nibble at some bargains. You really have to look at each stock's performance individually. This could be a great time to invest in XOM, for example.
Were you guys waiting for a Houston resident to speak up? :-). The Texas economy is more diversified than people think. Houston has a strong culture of entrepreneurship, plus a massive medical center, the largest port in the U.S. and technology companies. As a result, we are not headed the way of Detroit, although the oil patch has certainly dealt out plenty of layoffs. As for being a nice place to live...YES for the people...YES for cost of living...weather and scenery...sigh...not so much!
Thanks all. Where I feel led is to blog on cultural and religious issues, in keeping with my current seminary studies. I may contribute to get back in the swing of public writing, but ultimately, the blogosphere is where my heart lies.
It is a calling that requires me to come clean with "YoYoMama", something I have wanted to do since starting seminary last fall. I own it...but I've moved on from it. It is not a part of my today. We all change and grow. Thank goodness for that!
Blessings, and YES 2016 will be a great year for us all,
Denise