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  • UBS ETRACS Monthly Pay 2X Leveraged Closed End Fund ETN: A Pragmatic Approach [View article]
    "any Etracs ETN is a fools game...they will all lose value over time, both the stock price and the Div..."
    Start date: 07/07/2010
    Start price/share:$26.02
    End price/share: $23.35
    Dividends collected/share:$25.34
    Total return:87.12%
    Average Annual Total Return:12.32%
    Starting investment: $10,000.00
    Ending investment: $18,715.09
    Years: 5.39
    Investing in a leveraged note is investing with leverage in the INDEX that it tracks. CEFL tracks the ISE High Income Index, which is filled with CEFs that have destructive ROC. MLPL tracks the Alerian MLP Infrastructure Index, which is filled with midstream MLPs, and its distributions went up every year. BDCL tracks the Wells Fargo Business Development Company Index. These indexes use different selection rules and are in different sectors.
    There is nothing that by default dictates that an ETN is worthless.
    Nov 29, 2015. 08:08 PM | Likes Like |Link to Comment
  • Utica Shale gas drillers hit gushers, rewarded with slumping stock prices [View news story]
    When the 2nd biggest job growth area (after older workers going into customer service positions) is in domestic oil, and domestic oil starts laying off, who is left to pay $19T in government bills?
    Nov 28, 2015. 11:43 AM | 7 Likes Like |Link to Comment
  • Preferred Stock Market Q3 2015: Investment Grade Preferred Stocks Available Below $25 [View article]
    "U.S. Cellular, which operates in [only] 26 states, reported a net loss of 34,000 customers in the first quarter, its seventh straight quarterly decline."
    If you want to be in cell carriers, wait for TMUS preferreds to go under $50.
    Nov 27, 2015. 01:06 PM | Likes Like |Link to Comment
  • A Safe 11% Yield From A REIT Debt Issue [View article]
    galicianova, perpetual is good, but most are callable at some point. If something is callable, such as I pretend that it will be called in ten years to give me a theoretical YTM, in this case 11.25%... But that is just hypothetical, since as the author says, it is hopefully perpetual. As long as you buy far under par, getting called is not the worst thing.
    Nov 27, 2015. 12:59 PM | Likes Like |Link to Comment
  • How To Return To Oil Sector Investing [View article]
    The index would have to remove any companies in bankruptcy, therefore we would not be included in any liquidation disbursements.
    Nov 27, 2015. 12:08 PM | Likes Like |Link to Comment
  • Best Industrial Stocks According To Buffett Principles: A Look At Costamare [View article]
    Thanks to buying when CMRE-C approached a new low, it is (bizarrely, considering the shipping industry) my 3rd largest gain. It was LUCK that I bought 3 times in a row on a high-volume day, and others may not get their low bid to go through, but I had good luck buying.
    Nov 27, 2015. 12:03 PM | Likes Like |Link to Comment
  • CEFL Still Attractive With 22.4% Yield And Large Component Discounts To Book Value [View article]
    "An investment of $100,000 would be worth $274,919 in five years."
    "In 5 years your money will be long gone."
    If I am around in five years, this could be an interesting comment to come back to...
    Nov 26, 2015. 01:09 PM | 1 Like Like |Link to Comment
  • Seadrill: Follow The Stock Price [View article]
    Here is SDRL's problem, not that this is news to anybody: They need positive free cash flow, not just paper earnings.
    Their floaters need $352,000 day rates to break even on cash. Jackups are easier at $107,000 per day, but that is higher than competitors.
    For now, SDRL must accept lower rates to utilize fixed overhead as much as possible. As we learned from SDRL cancelling their contract with Husky, even though SDRL had warm-stacked rigs that could have taken the job, it is sometimes "less un-profitable" to not work at all. Even after pushing deliveries back, there will be many new rigs being delivered to many drilling companies around 2017. And when the oil supply glut reverses, SDRL's greatest strength (G6+ rigs capable of pumping vast amounts of UDW oil) will be competing with a glut of rigs, keeping dayrates down even longer. The market for oil rigs will only get worse as new rigs are delivered. SDRL's fleet utilization will drop by half by 2017, meaning that they will be somewhat desperate for leases.
    1/5 of their "contracted" revenue is with Petrobras, so who knows how much will be cancelled; I would assume the worst.
    I learned a lot by not selling at $40, but I also learned to overweight FCF & OCF. The new way I calculate value makes SDRL a strong buy at $3.26 per share, less than 1/10th of what I previously paid. Such is life.
    Nov 25, 2015. 02:21 PM | 8 Likes Like |Link to Comment
  • Mortgage applications decline [View news story]
    "Affordable" healthcare has driven my premiums & doctor bills so high that I now pay more for insurance for a family of 4 than I pay for a mortgage.
    Because of ACA, my employer switched from 1,200 FT employees with full benefits to 1,600 mostly part-time temps with no health coverage. "Free" or "affordable" has caused millions to be laid off and take part-time jobs, and then the IRS fines those laid-off people for not being able to afford health insurance.
    Everybody laughed at Dr. Ron Paul for predicting this... because what would a doctor who studied economics know? You know what would fix the mess government programs caused? More government programs!
    Nov 25, 2015. 01:38 PM | 5 Likes Like |Link to Comment
  • Ensco Still May Not Cover Dividend Internally [View article]
    ESV carried less debt than competitors, had high customer satisfaction, positive and rising retained earnings & total equity, and increasing cash & equivalents...
    ESV management is the best, which they proved when they cut the dividend and implemented cost-cutting.
    Nov 25, 2015. 12:00 PM | 1 Like Like |Link to Comment
  • Ensco Still May Not Cover Dividend Internally [View article]
    He probably got it from here
    "Its floater fleet has an average age going forward of ten years, and the ultra-deepwater fleet has a four-year average age." ESV's strength for now is in its cheaper jackups, which they have proportionately more of, which means that their total fleet average age is proportionately closer to ten years old.
    Nov 24, 2015. 06:34 PM | Likes Like |Link to Comment
  • CEFL Still Attractive With 22.4% Yield And Large Component Discounts To Book Value [View article]
    "I ran regression analysis to determine if there was any correlation between the proportion of the dividend paid by a closed-end fund that represents a return of capital and the discount to book value that the closed-end fund is trading at. For the 30 closed-end funds that comprise the index CEFL is based on there was no statistically significant relationship."
    You did not find any correlation between CEFs that pay ROC distributions with their declining NAV over time, nor a correlation between declining NAV and increasing discount to NAV... That is an interesting thing to NOT find correlation between.
    It seems natural that CEFs with declining NAV would be sell at discount to NAV, because investors think in terms of total return: If an investor wants a 10% total return from a stock whose price declines 5% per year, then he would not buy until a 15% yield. Similarly, CEFs whose NAV is in year-after-year decline would logically sell below book value in proportion to how much investors expect future declines. Also, as the NAV declines, the distribution eventually follows. Investors should plug index components with declining NAV into a dividend history chart to see the declining distributions.
    Using EVV as an example, CEFconnect shows a distribution of 9.6%, but total annualized return since inception (based on NAV) is 6.33%. A newer CEF is PCI, with a distribution rate of 10.8%, but a return (based on NAV) of 5.19%. Investing in CEFL means only buying at the lowest of the low, during the most extreme discounts, which we have not yet seen, and after the December rebalance pummels value again.
    Nov 24, 2015. 04:34 PM | 1 Like Like |Link to Comment
  • Ensco Still May Not Cover Dividend Internally [View article]
    I would support suspending the dividend. SDRL did it, and it probably saved the company...
    Sure, ESV is in much better shape with less debt and a lower-cost fleet, but every driller on Earth seems to have either a lot of rigs coming off contract or newbuilds being delivered by 2017. As long as there is a high supply of rigs chasing contracts, rates will be low. Just because ESV is fine for now does not mean that they should not prepare for the worst. If things suddenly reverse, they can start paying again.
    Nov 24, 2015. 12:25 PM | 1 Like Like |Link to Comment
  • MORL Now Yielding 28.3% mREITs At Enormous Discounts To Book Value [View article]
    "that none in the past dared answering..." There are a dozen answers & debates on this topic on older MORL (and CEFL) articles.
    The short answer is a probable yes on CEFL due to the fact that the index it tracks selects self-destructive CEF components. The answer on MORL is that yes it is possible... but unlikely, unless the pummeling on mREITs gets worse for years. The likelihood, however, that interest rates will shoot up quickly or start jumping all over is pretty much zero, so I am betting on increasing volatility (i.e. opportunity), which will finally settle sometime next year. I am watching to buy MORL in the mid-12s.
    Nov 24, 2015. 11:03 AM | 1 Like Like |Link to Comment
  • MORL Now Yielding 28.3% mREITs At Enormous Discounts To Book Value [View article]
    BDCL was introduced on 05/25/2011, and MLPL was introduced on 07/07/2010, and they were indeed "PLUS 2x leverage."
    Nov 24, 2015. 10:53 AM | 1 Like Like |Link to Comment