Seeking Alpha

rustic06

rustic06
Send Message
View as an RSS Feed
View rustic06's Comments BY TICKER:
Latest  |  Highest rated
  • Thoughts On Commodities As An Asset Class [View article]
    I take the longer view on commodities.

    I don't trade commodities. I buy and hold them in closed end funds. I hold GGN for the same reason I hold CFD - income. Also I hold stock funds supporting commodities like BCF BQR BGR. GGN and CFD pay distributions near 10% on an out of favor asset class. The others are in the 8% range. The distributions are generated from option sales on holdings (very volatile - very good for diligent call writing).

    The NAV of the commodity funds have decayed over the last 5 years but asset class cycles in commodities drag on for years. These out of favor CEFs have also moved to discounts (fleeting with GGN). In the next cycle when commodity prices trend up again the total return will be very large over the holding period. 10% monthly/quarterly cash is not bad compensation for waiting on the next up cycle.

    Entry points are important, of course. I see commodities at or near cycle bottoms. The great international currency race to the bottom, the frantic measures by the central banks to ignite inflation and geopolitical chaos can only help the commodity cause. I keep the total commodity allocation at less than 15%, all in high distribution paying CEFs with good performance characteristics.

    regards
    rustic06
    Aug 16 05:28 PM | 1 Like Like |Link to Comment
  • Another High Income Covered Call CEF Portfolio [View article]
    Question about ROC. What happens when you sell a CEF like ETB after holding it several years? Is the cost basis not reduced by the amount of ROC taken over the holding period similar to depreciation? Not clear on this.
    Jun 22 09:53 AM | Likes Like |Link to Comment
  • Interview With Prospect Capital President And COO, Grier Eliasek [View article]
    I like BDCL also but sold last year when the chart began to flatten. As you pointed out there is presently a shakeout of BDCs in progress due to the S&P BDC deletions and Russell 2000 index funds may follow (see Barrons, Feb 26). A dip may be beginning, or just ended (doubt). I am waiting for an entry and will continue for a few more days or week.

    regards
    rustic06
    Mar 2 04:19 PM | Likes Like |Link to Comment
  • Equity CEFs: Utility CEFs Are Back [View article]
    I prefer UTF to your utility picks. UTF is global. It is at a 13 % discount, sports a 7% distribution rate (lower than the J's) and charts in line with XLU and JXI on one year and outperforms on 2 year charts. My other global util is MFD. I like the global utils over the US using diversity and performance.

    Any thoughts about BQR as a water utility? Any water CEF's out there?

    regards
    rustic06
    Feb 3 06:10 PM | Likes Like |Link to Comment
  • A Better Way To Profit From Inflation Than Gold Or Silver [View article]
    A little primer on "guys like me"

    Guys like me must meet expenses in our personal and business lives daily. We cannot ignore the prices of food and fuel because they are volatile. We cannot "smooth" or sidestep "spikes" in prices. We cannot escape relentless government requirements for wasteful activity and for documentation thereof, not reflected by any CPI. We have to pay up to produce the paperwork or pay fines or worse. This may not show up in final price but has the same pernicious effect as price inflation. We cannot always substitute one good or service for another for very good reasons. The "chained" CPI is yet another tweak designed to minimize price increases.

    The cost of living, then, is increasing for "guys like me" but "prices" are not going up. This works well for the BLS and their economists, not for guys like me.

    If you google "inflation" "CPI" and "fraud" you see over 1,000,000 hits. There seem to be a lot of "guys like me" out there. More all the time.

    Not to detract from government economists, "guys like you" have contributed a lot. Look at the US economy and all the wonderful jobs our governments' fiscal policies have created in the last 5 years.

    rustic06
    Jul 13 07:50 PM | 1 Like Like |Link to Comment
  • The Marginal Cost Of Gold/Silver Production (2012) [View instapost]
    Swayze8, you are right. Bitcoin tried to recapitulate the gold market value model by creating a fixed amount of cyberwealth to which only a small amount of new wealth of known quantity could be incrementally added. Gold is not bitcoin (bitcoin could be hacked or otherwise contaminated) the gold model has been safe for over 3000 years which makes it precious. It is not a commodity, it is something of great value, not money in the strict definition, but closer to real money than fiat.

    You are right that gold should be valued as a rare painting or other highly valued art object rather than oil which is used up almost immediately after being refined. IMHO gold demand at this time is more important in the pricing of gold than production. As loss of gold production begins to be noted in the media and demand picks up, then the price will rise steeply. Gold is a relatively small market and its price is likely being manipulated at this time.

    I am buying mining stocks and CEF.
    Jun 29 11:44 AM | Likes Like |Link to Comment
  • 5 BDCs To Buy For Up To 11.7% Dividend Yields [View article]
    Enjoyed the article and comments.

    I recently sold all BDC,s.... Lousy outlook for small businesses (my own local observations), FED talking up and actual narrowing of credit spreads, toppy charts, continuing idiotic and malevolent antibusiness policy from Washington. If BDC,s crash the crater will be wide and deep.

    A good run, though. Will keep BDCL, KCAP, TCAP, TICC, MCC in the rolodex.

    Raising some cash now and searching hated sectors for value.

    Rustic06
    Jun 18 10:41 AM | 1 Like Like |Link to Comment
  • Use Caution With Double Digit Yield ETFs [View article]
    David

    I have migrated to MORT after being in several individual mREITs. I use stop loss orders to manage risk in securities like this.

    I am increasingly worried about flash crashes like the one this month. Not much I can do except write strong emails to the SEC.

    regards
    rustic06
    May 1 01:26 PM | 1 Like Like |Link to Comment
  • 5 Reasons Why I Am Shorting The Market [View article]
    I prefer leveraged short funds with high volume like SPXS to index puts since the option decays over a short time and eventually has to be rolled into new positions. This seems very expensive to me.

    When I feel the need, like now, I take a small part of my cash allocation (which pays nothing) and gradually "dollar cost average" into rallys. J L Livermore called this type of position a "probe". Skin in the game but not too much. As time unfolds and the crisis becomes clearer I add more to the position or close.

    I could use a good short stock fund that pays great dividends! Just a thought.

    Greatly enjoyed and appreciated your article.

    regards
    rustic06
    Apr 16 04:43 PM | 1 Like Like |Link to Comment
  • Does Momentum Investing Actually Work? [View article]
    The market knew about subprime mortgages and CMO swaps in May 2008 but kept skating along.....hey...ice is getting thin here!
    Apr 12 09:41 AM | 1 Like Like |Link to Comment
  • 10% Return In Q1 For 'Savvy Senior' IRA - Now What Do We Do? [View article]
    Agree that the 13.76% distribution yield is net of expenses. A YOY chart with distributions shows quarterly 0.55 payments or $2.20 for the year. $2.2/$15.984 (todays close) = 13.76%.

    Thanks to Mr Bavaria for the links.
    Apr 5 10:10 PM | Likes Like |Link to Comment
  • 10% Return In Q1 For 'Savvy Senior' IRA - Now What Do We Do? [View article]
    Many thanks for this valuable post. I have OXLC in my floating rate allocation. I am adding to the floaters on weakness. The average CLO maturities seem to be in the 7-12 year range as given by cefconnect.com and last semiannual report. The OXLC website is not too helpful in this regard. Any ideas about average maturity and duration?

    regards
    rustic06
    Apr 5 12:57 PM | Likes Like |Link to Comment
  • Why Muni Bonds And Muni CEFs Have Been Falling [View article]
    Has the author encountered an asset class which would act as a hedge against a municipal bond fund CEF decline? I see a mild inverse relationship over last three years with my sentinal leveraged muni IIM in floating rate bond funds. Nuveen has a short dollar/floating rate emerging market currency CEF which also has an inverse relationship. Inverse US treasury bond funds track as well as floaters or better but don't pay distributions.

    I have had a sizable buy and hold allocation for about 25 years in muni CEF's and anticipate another "waterfall selloff" when the FED jacks up rates again (I agree that is an unlikely event at this time).

    regards
    rustic06
    Apr 2 02:21 PM | 1 Like Like |Link to Comment
  • Rebalance Periodically, Review Frequently [View article]
    Thanks for the AA review. My allocation has only 6 categories, I have been thinking about expanding it and your model looks very good. I have a position in all of your categories except US government bonds.

    Where would you place floating rate bonds in your allocation?

    rustic06
    Mar 15 10:57 AM | Likes Like |Link to Comment
  • 5 BDCs To Buy For Up To 11.7% Dividend Yields [View article]
    I also own BDCL. Formerly owned TCAP, a stellar performer as well as KCAP, PSEC and TICC but trailing stops kept triggering after rights offerings. BDCL dosen't appear to be as volatile as its leveraged status would suggest and now I just watch it.

    regards
    rustic06
    Mar 15 10:32 AM | 1 Like Like |Link to Comment
COMMENTS STATS
47 Comments
28 Likes