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  • Prospect Capital And Required Returns [View article]

    I too want to thank you for your continued articles. I believe that you are merely warning investors of potential losses to come regarding PSEC. And I believe you are sincere when you share your thoughts with us. There are many other authors whom I believe write to create controversy and increase comments. I have been reading your articles for a long time now and I think you are one of the good ones.

    I do believe that PSEC will reduce their divvy next year by 10%~20% and the price will drop below $9.00. When that happens I may invest some more or not...depending on all the circumstances.

    Best wishes for continued success! :o)
    Nov 21 10:47 AM | 5 Likes Like |Link to Comment
  • Prospect Capital And Required Returns [View article]
    * year annualized total return for PSEC = 4.77%

    I could have done better with any number of stocks...including JNJ and PG!
    Nov 21 10:41 AM | 1 Like Like |Link to Comment
  • Prospect Capital And Required Returns [View article]
    Agreed Brucejfern.

    5 year annualized total return for 5 BDC's:

    MAIN = 28.31%
    TCAP = 23.03%
    HTGC = 18.68%
    ARCC = 17.23%
    PSEC = 9.95%

    Dividends are nice but not when you lose your capital! I want the divvy and I want some appreciation.
    Nov 21 10:39 AM | 4 Likes Like |Link to Comment
  • Prospect Capital And Required Returns [View article]
    And I don't own any of those other BDC's with 2% fees. I do own PSEC but have reduced my position by 70%. I plan to keep the first shares I bought since the cost basis is $8.04...
    Nov 21 10:31 AM | Likes Like |Link to Comment
  • Prospect Capital: Two Reasons Why Prospect Capital Is A Strong Buy Below $10 [View article]
    They are covering the dividend now but taxable earnings will come down and they won't be covering the dividend then. Expect a divvy cut in the March ~ May timeframe.

    When that happens the share price will fall below $9.00 and maybe approach $8.00. That will be the time to buy.
    Nov 20 04:06 PM | 4 Likes Like |Link to Comment
  • Prospect Capital: Two Reasons Why Prospect Capital Is A Strong Buy Below $10 [View article]
    Actually taxable income and NII typically do not vary by much. PSEC's taxable income is inflated by one time events. I would not count on it continuing to cover the dividend.

    There will be a dividend cut or maybe two in 2015 totaling ~20%.
    Nov 20 04:04 PM | 3 Likes Like |Link to Comment
  • MORL December Dividend Higher - Annualized Yield 23.1% [View article]
    Prof Brofman,

    Thanks yet again for a very informative and interesting article.

    I think the Fed is currently more concerned with deflation than inflation. I have no doubt that one day inflation will become an issue but that day is far away.

    I also appreciate your almost OCD approach to understanding why your predictions were not as accurate as you thought they should be. I have no doubt that you will continue to hone your prognosticating skills until you are spot on every time!

    Best of luck to you and much success! :o)
    Nov 19 03:26 PM | Likes Like |Link to Comment
  • MORL December Dividend Higher - Annualized Yield 23.1% [View article]

    Darren...I always read your comments with interest and appreciation. Of course it doesn't hurt that I almost always agree with you! LOL

    Thanks for bringing up the volatility issue on MORL. I too own MORL and have given it a full allocation in my portfolio.

    I think the Fed may have more concerns right now about deflation than inflation.

    Much success! :o)
    Nov 19 03:22 PM | Likes Like |Link to Comment
  • I Don't Care About A Net Asset Value Decline... Prospect Capital Is A Strong Buy [View article]
    Income only goes up is you buy more shares of the same stock or a stock with a higher yield. And if the stock(s) you buy do not cut their dividends.

    I am not a trader but I do value total return. Income is primary but total return should not be sacrificed for income. If you do not care about the share price but only the dividend you are fooling yourself into thinking you have it made when you don't.

    Once those dividends are cut you will have not only reduced principal but reduced income as well.

    I set an allocation for each Sector and stock I own. I will take my dividends in cash and buy stocks on my watch list until each stock's allocation is reached then proceed to the next one on the list.

    I prefer to buy and hold forever but if a company cuts their dividend they go on a death watch which could result in my selling some or all of allocation. Depends on various factors...including management...which in PSEC's case is shaky. Not to mention the ridiculous fees charged by the management company. A BDC the size of PSEC should be reducing fees.
    Nov 19 02:47 PM | Likes Like |Link to Comment
  • Quit Chasing Silly Rabbits And Invest For The Long Run [View article]
    Thanks for a great read Brad! :o)

    I own the following reits in equal $ allocation except for ARCP. GOOD, and WSR which are half shares in my portfolio.

    I like to have some risky investments in every sector / category but limit the amount to half or quarter shares of allocation. Interestingly, my risky investments have paid off well over the years (MSFT and INTC were considered risky at one time!)

    So I think I will hold my ARCP and limit my exposure.

    Nov 18 04:47 PM | 1 Like Like |Link to Comment
  • Quit Chasing Silly Rabbits And Invest For The Long Run [View article]
    Well said Buy...

    I always have cash available and always take my dividends in cash.

    When a stock on my watch list falls out of favor for whatever reason and goes on sale...I buy. This strategy has been successful for me over the past 30 years.

    Although I can understand DRIP investing if you are just starting out and do not have the cash available.
    Nov 18 04:41 PM | 1 Like Like |Link to Comment
  • The Case For Navios Maritime Partners' Stock Buybacks [View article]
    sdz...I agree with you. Pay the dividend. If you have money left over and want to buy shares back then fine. But do not sacrifice the dividend for share buy-backs.

    Companies like NMM, BDC's, mReits, etc. issue new shares all the time to fund their business. Why in the heck would they start buying shares back? If you have that much cash keep it to pay future dividends and fund the business while eliminating some of those new issues.
    Nov 18 04:32 PM | 2 Likes Like |Link to Comment
  • Prospect Capital: Revisiting The Dividend Debate [View article]

    Thanks for this follow-up article. You could say I was one of the 'negative' commenters to the first article, but I appreciate your frankness in this writing.

    I had concerns about PSEC using Taxable income instead of NII. As you rightly stated NII and taxable income typically do not diverge much. It seemed to me that PSEC management was using this as a 'smokescreen' to divert criticism and buy time...maybe to make more ATM sales of stock below NAV?!?

    I also find PSEC management's crybaby attitude about not getting credit for announcing future dividends to be childish. This makes me think these guys are not professional or competent.

    I too am long PSEC, but not as long as I was. I bought into PSEC back in August 2011 at a great price! And I have made a nice return from PSEC. Recently I sold 50% of my shares to lock in my gains and in advance of the dividend cut that is which time I believe the price of PSEC will fall.

    I am speculating that PSEC will have two dividend cuts in CY2015 totaling 20%. The first should come about Feb ~ March. The second should be July ~ August. I base this speculation on PSEC management's petulant attitude, ATM sales below NAV (they won't be below NAV after the first divvy cut), and the fact, as you pointed out that PSEC only has 88x div coverage.

    What do you think?
    Nov 17 05:01 PM | 5 Likes Like |Link to Comment
  • Total Returns For BDC Portfolios: November 2014 [View article]
    Hi Buzz,

    If you are using dividends as income to live on...monthly is nice. Kind of like a paycheck.

    If you reinvest the dividend, maybe a DRIP, you get compounding monthly instead of quarterly.

    I don't believe that it is easier for a company to manage their cash flow quarterly versus monthly. Every month they close the books and do all the same accounting. A good company should be managing their cash flow daily.

    Thanks for the article! :o)
    Nov 17 03:35 PM | 3 Likes Like |Link to Comment
  • REITs Are Prime-Time Players, Baby! [View article]
    yeah! 7 of my reits were in the top 10. I do not own DLR, STAG, or SKT. I just added OHI last week...finally.
    Nov 14 09:36 AM | 1 Like Like |Link to Comment