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User 7415181
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I'm writing an instablog - I know of a few people who have read some, but the main reason for writing it is to clarify my thinking (and likely confuse you) before I invest in something every month or so. And also to act as a journal I can review every so often. I work as a mental health nurse.... More
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User 7 blah blah's instablog.
  • Out Of The Night Comes A Song That I Know, Twisted And Ruined And Black 9 comments
    Mar 8, 2014 12:07 PM | about stocks: CHW, GEQ, TPZ, PSEC, UTF

    "User doesn't like his current job and wants a different type of job being the house supervisor. Well, I don't know about his sense of humor or communication skills. He says he absolutely doesn't want to be charge nurse of the unit. He says he doesn't see the correlation between the two."

    "I know! Maybe if we make him do that a few times a week he'll learn to love it! Especially if we smile at him when we come through and act surprised that he's the charge! He can do the same type of work he's good at and have the added responsibility of supervising the entire unit and staff and wasting several hours a week in doctor's meetings and get paid a whole $1 extra an hour!"

    Yeah.

    One nice thing about writing these blog things is that I can look back and see if there are investments I was considering but didn't buy because another one was more appealing at the time.

    A week or two ago I sold off my Roth cefs and preferreds for a profit and bought (NASDAQ:PSEC) the day after it started dropping. 12% yield compounded tax free should be quite nice for a while. (note that I'm not contributing to that account until the taxable has a year's equivalent salary in it and both my 401k and taxable account are worth much more and are much more diversified)

    (NASDAQ:CHW) - one of the cefs I sold off in the Roth account and I've owned on and off for a couple of years. About half equities, some convertibles some bonds. Global. Over a 13% discount right now, pays monthly and a bit over a 8% distribution rate. Even with all the European craziness and problems over the past few years, the nav keeps creeping up and the market price has started to diverge more.

    (NYSE:TPZ) - wrote about this last time so I'll just copy/paste:

    "owned it a couple of years ago, and if had not sold and dripped I would have been very happy. Anywho, currently at a 10.5% discount. Yield is only 5.8%. The NAV when they started in 2009 was 19 and is currently 28.4. And the distribution hasn't changed since it started. Monthly pay. Mix of mlps and energy bonds. No k1 form. NAV flatlined over the last year, so that may be the reason it's dropped to a big discount. Or because it holds a fair amount of fixed income. Monthly pay."

    Here's an article I came across a while ago about mlp cefs:

    seekingalpha.com/article/2045173-kayne-a...

    which is worth a read. Author argues that (NYSE:KYN) is the best mlp fund and it may be. It also trades at a premium so that rules it out for me. I went to Costco a couple of Friday's ago and saw that tenderloin "prime" was $21/lb and "choice" was $11/lb. I don't doubt the prime came from a less deformed steer, but at the end of the day it's how you cook and season it that counts and I bet I can get a good meal for a better price.

    Anywho. Where was I? Oh. If not for that article I would not have known that a couple of the Tortoise funds are merging and that explains why some are at a significant discount (and thus show up when I do an initial screen) and others are close to nav value. What that indicates to me is that Tortoise is trying to compete with Kayne Anderson by making shareholder friendly moves.

    I bought NDP last time, and am considering TPZ in the hope that Tortoise might do some shareholder friendly moves with their other funds in the future. And a halfway decent yield is nice and the navs have done fine since inception.

    (NYSE:UTF) - this is another fund I owned a couple of years ago and if had just held it and dripped instead of taking a quick profit, I would have been very happy with the results. Close to a 12% discount and a 6.5% distribution. It's listed as an infrastructure fund. Go over to cefconnect and check out how the nav has done and you'll see that it's come back nicely since 2008.

    No preferreds that I saw currently interest me. (NYSE:GEQ) might be a wild card option, but the discount has narrowed a bit since I last was thinking about it. And the next distribution won't be until May or thereabouts.

    edit - OXLCO is my current favorite preferred below par value - I already have a fair amount (for me), but I would buy more as my backup option if the above things narrow their discounts. My crappy discount broker informed me that they will do a synthetic drip for preferreds, so the current plan is to buy them below par, drip the dividend and have a limit order in place for par value. And OXLCO is mandatory redeemable in 9 years. And is trading (when it trades) around $23 with a par value of 25. The underlying fund looks nice, but I will not buy into a cef unless it's close to double digit discount.

    So. If the discounts hold by my Friday paycheck, CHW first, UTF second, TPZ third.

    edit for 3/14 - TPZ it was.

    Disclosure: I am long PSEC.

    Additional disclosure: The sun is out! It's kind of warm!

    Stocks: CHW, GEQ, TPZ, PSEC, UTF
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Comments (9)
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  • Land of Milk and Honey
    , contributor
    Comments (4004) | Send Message
     
    Hi User7

     

    On (OXLCO) what do you like about it that makes it a buy? What is it invested in? I'm going to try to get a feel for these, CEFs.

     

    You say you don't see anything appealing at the moment, but you are considering buying CHW first, UTF second, TPZ third? I'm missing re-reading something.

     

    What are you're thoughts on interest rates, ZIRP ending, and rate sensitive issues dropping? Have these dropped before over rates? Are they fully recovered back from that point if they did? I should be asking this on my blog, so it might draw thoughts from a variety of folks. I'll post here... then there is it makes sense to...

     

    Sorry your job is going through a rough patch, or it is a rough patch, or that's a nice way of saying what it is.... hope you find a solution to this soon, either another job or another option within this job.
    9 Mar, 01:33 AM Reply Like
  • User 7415181
    , contributor
    Comments (692) | Send Message
     
    Author’s reply » Hello again! (OXLC) is a cef - OXLCO is one of their preferreds. That preferred is trading around $23 with a $25 par value. And it's mandatory redeemable in 9 years. The underlying cef would have to cut their distributions to nothing before that preferred's dividend gets suspended. That's why I like it.

     

    I don't think I said that I don't find anything appealing? Not so much in preferreds aside from oxlco - many of the ones I might be interested in have had big price bounces over the last month or so. But there are still cefs that look like a good deal. And I still plan on buying one of the above funds on Friday as long as the prices don't change much.

     

    "What are you're thoughts on interest rates, ZIRP ending, and rate sensitive issues dropping? Have these dropped before over rates?"

     

    I know that last May anything with a yield got hammered quite badly and I was buying preferreds along the way down. They're starting to bounce back so I'm thinking they were sold off too much. But at some point interest rates will rise (or at least everyone keeps saying that) so I'm trying to stay diversified with cefs that may do fine with a rise in interest rates.
    9 Mar, 08:22 AM Reply Like
  • Fear & Greed Trader
    , contributor
    Comments (4964) | Send Message
     
    Great read, thanks for the info !!
    9 Mar, 12:12 PM Reply Like
  • User 7415181
    , contributor
    Comments (692) | Send Message
     
    Author’s reply » And thank you for dropping by and the compliment!
    9 Mar, 01:44 PM Reply Like
  • Land of Milk and Honey
    , contributor
    Comments (4004) | Send Message
     
    User7

     

    Hi! What I was thinking, is if you post the various issues themselves that you mention in your blog, and a few specific thoughts about 1 or 2... it might entice people to click and come to the blog... kind of like teasers. It'd add variety to the chapters, so it's good for the our instablog-forum too.

     

    I did finally dig into the CEFconnect site for thoroughly. Do you think there are many CEFs that aren't listed on there, or do they cover the US investment field?

     

    I stand corrected... you didn't say that you didn't find anything appealing, you said that about prefers.

     

    "I'm trying to stay diversified with cefs that may do fine with a rise in interest rates. "

     

    To me that's important right now, so I'll be asking about which ones you think are good that way out of your ideas :). In past years when interest rates were going to rise, I'd stay out of investments locking me into low rates... that served me well. Meanwhile, Tack's view was to get into things, and not try to guess where and when the market was going, and jump out when the rate reaction hits. Still, I can focus first on less rate-sensitive stocks. ...which he also suggested floating rates.
    13 Mar, 12:36 AM Reply Like
  • User 7415181
    , contributor
    Comments (692) | Send Message
     
    Author’s reply » LMH,

     

    Honestly, you have to take cefconnect with a grain of salt. Information on it is often dated or incorrect so you always want to verify it with something else. And I have no way of knowing if they list every fund (I doubt it).

     

    Interest rates can go up but they can go down too. And at some point we'll have another ugly stock market. All I can do is try to find things that are unfairly undervalued at the time when I have money to invest. The yields help me mentally handle the downturns.

     

    Sorry I haven't been as chatty in your blog this week. :)
    13 Mar, 07:07 AM Reply Like
  • Land of Milk and Honey
    , contributor
    Comments (4004) | Send Message
     
    U7

     

    Well, that's helpful to know about CEFconnect. Unfairly undervalued at the time, makes sense. I wish I had more time to research - I think it'd be easier then to develop a confidence that something is undervalued vs. something else.

     

    "it might entice people to click and come to the blog."
    I meant as teasers to come to your blogs here. Since you posted the link to here, which was great, I was thinking a few more details about this one (or the next one) as where the link is might get more clicks over to here. There's very good info that you're posting, and it'd be nice of people can take advantage of reading it...
    13 Mar, 07:56 AM Reply Like
  • User 7415181
    , contributor
    Comments (692) | Send Message
     
    Author’s reply » Understood, I'll try to do that for the next one. If I do that for this list, I might trick myself into looking for something else to buy after I already did some research on these! :)
    13 Mar, 08:12 AM Reply Like
  • Land of Milk and Honey
    , contributor
    Comments (4004) | Send Message
     
    U7

     

    I know what you mean!
    14 Mar, 12:22 AM Reply Like
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