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AU1981

AU1981
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  • Profit Rankings For BDCs: May 2014 [View article]
    Buzz, thanks for your articles. Any thoughts increasing exposure to pay in kind issues in the BDC space?

    Thanks!
    May 6, 2014. 09:48 AM | 1 Like Like |Link to Comment
  • Are The Wheels Falling Off For Armour Residential REIT? [View article]
    Agree with you. Cut positions on ARR. Moved them elsewhere. Notice AI did not cut dividends today.
    Sep 19, 2013. 10:54 AM | 1 Like Like |Link to Comment
  • Mortgage REITs on the move as Summers pulls out of Fed running [View news story]
    This is a temporary rise. I am, however, glad that he pulled out. An anencephalic monkey would have been a better choice than Summers.
    Sep 16, 2013. 11:22 AM | Likes Like |Link to Comment
  • MORL Dividend Drops Again In September But It's Now Yielding 32% On A Monthly Compounded Basis [View article]
    Well, look at that! mREITs are up almost across the board and the 10 year is up 1.6%. Maybe the correlation finally broke?
    Sep 4, 2013. 01:50 PM | Likes Like |Link to Comment
  • American Capital Agency: Harness The Power Of Compounding To Prevent Losing Money [View article]
    Always good to be learning new things about these firms. Thanks for the replies.
    Sep 4, 2013. 11:19 AM | Likes Like |Link to Comment
  • MORL Dividend Drops Again In September But It's Now Yielding 32% On A Monthly Compounded Basis [View article]
    Indy,
    Thanks for putting some perspective on the mREIT space. I was commenting with a friend that mREITs should not constitute a large portion of a retiree's portfolio b/c of the volatility they exhibit, and the inconsistent dividend stream, which makes living off them fairly unpredictable. I would also add that retirees who own mREITs may get spooked by the volatility and sell at inopportune times. Psychologically, if you can't stomach the volatility, this is not the game for you.

    Also, what would you say to Brucejfern who keeps comparing the S&L crisis with what he sees as an inevitable holocaust in mREITs? Although anything is possible, it seems like the environment is somewhat different today, as in, we won't see rates as high as they were in 1980's, no?
    Sep 4, 2013. 09:50 AM | Likes Like |Link to Comment
  • American Capital Agency: Harness The Power Of Compounding To Prevent Losing Money [View article]
    The main reason I switched from OptionsHouse to Vanguard was precisely b/c they didn't have this option. You're right that if you trade frequently Vanguard is not cheap. However, their costs on ETF's and MUTF's are indeed cheaper than a majority of other institutions. Just my opinion, but something to consider when choosing an investment firm to park your savings into.
    Sep 3, 2013. 04:29 PM | Likes Like |Link to Comment
  • MORL Dividend Drops Again In September But It's Now Yielding 32% On A Monthly Compounded Basis [View article]
    Thanks for clarifying.
    Sep 2, 2013. 05:49 PM | Likes Like |Link to Comment
  • MORL Dividend Drops Again In September But It's Now Yielding 32% On A Monthly Compounded Basis [View article]
    Hi Lance,

    Page PS-9 of the pricing supplement in the Morning Star website http://bit.ly/18vMLrP

    states the following:

    "You will receive a cash payment at maturity, upon acceleration or upon exercise by UBS of its Call Right based on the monthly compounded leveraged performance of the Index less the Accrued Fees, calculated as described in the accompanying product supplement. You will receive a cash payment upon early redemption based on the monthly compounded leveraged performance of the Index less the Accrued Fees and the Redemption Fee, calculated as described in the accompanying product supplement."

    This is followed by several hypothetical scenarios that estimate the return of this "cash payment" based on the index performance.

    This brings up several questions, ie: is it possible to estimate what the value of your payment will be if the call right is exercised? Why would UBS call this issue? Why would you hold this issue if the call date is October 21st 2013, and what risk is there for UBS of calling the issue at that point?

    Thanks for the article.
    Sep 1, 2013. 05:26 PM | Likes Like |Link to Comment
  • MORL Dividend Drops Again In September But It's Now Yielding 32% On A Monthly Compounded Basis [View article]
    I think if found what you were referring to: http://bit.ly/18vMLrP

    This statement: "Investing in the Securities involves significant risks. You may lose some or all of your principal at maturity, early redemption, acceleration or upon exercise by UBS of its Call Right if the monthly compounded leveraged return of the Index is not sufficient to offset the negative effect of the Accrued Fees and the Redemption Fee, if applicable."

    The first call date is indeed October 21st 2013.

    This means that one may loose their entire investment if the return of the ETN is less than the fees they charge upon being called.
    Sep 1, 2013. 04:52 PM | Likes Like |Link to Comment
  • MORL Dividend Drops Again In September But It's Now Yielding 32% On A Monthly Compounded Basis [View article]
    Hi Dividend Investor,
    This is the link to the prospectus: http://bit.ly/18vLoJZ

    Can you point out the paragraph for the callable October 2013 date? I could not find a reference to it myself going over the text. I plan on asking an attorney to review the jargon regarding calling this issue.
    Sep 1, 2013. 04:36 PM | 2 Likes Like |Link to Comment
  • American Capital Agency: Harness The Power Of Compounding To Prevent Losing Money [View article]
    I would say that a large position in the mREIT space is not fit for investors in retirement or near retirement. I do however, agree with Chris' approach of compounding at these yields over time, which is incredibly powerful.

    I suppose the problem you could run into is institutional risk, which you could greatly minimize by buying REM if you want the exposure, and the 15% yield.

    I found that the cheapest way for me to reinvest dividends is using Vanguard as a brokerage firm. Virtually all equities I own (save preferred stock) are available to an automatic reinvestment option. This is a major advantage if you are pursuing this strategy.
    Aug 30, 2013. 05:12 PM | 2 Likes Like |Link to Comment
  • American Capital Agency: Harness The Power Of Compounding To Prevent Losing Money [View article]
    Thanks for this article, Christopher. I suppose this comes down to the most fundamental question we all have: will equities repeat the performance they have provided over the last 100 years, or are we in a different path today headed forward? If you believe that we will move sideways for the next several decades, then compounding dividends and interest may make sense. If you believe that capital gains will continue to provide outstanding returns as they did over the last century, then risking your capital on rocky issues like mREITs makes no sense at all.

    If you are not sure, like me, you do both...

    Thanks again.
    Aug 30, 2013. 05:06 PM | 2 Likes Like |Link to Comment
  • American Capital Agency Corp.'s Mid-Q3 2013 Composition And Valuation Analysis - Part 1 [View article]
    Thank you for the reply. If they are financing new asset purchases with sales, they will be essentially incurring losses on these sales, which are presumably at lower rates. In that case, will AGNC's hedging activities make up for these losses, and thus allow them to increase their spreads? If not, I don't see how making new acquisitions while incurring losses will really widen the spreads, and maintain the dividend.
    Aug 20, 2013. 08:40 AM | Likes Like |Link to Comment
  • Rate worries again rout income favorites [View news story]
    Sorry to hear that Darren. I made a similar mistake not going for longer term puts when AGNC dipped below $23.00...
    Aug 19, 2013. 04:09 PM | Likes Like |Link to Comment
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