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High Yield Dividend Portfolio; I target a minimum 20% return on stock price *and* a minimum 5% for dividend yield. Early retiree, father, and grandfather. Seeking alpha n00b. Opinionated SOB. Radical liberal conservative libertarian (I VOTE FOR NONE OF THE ABOVE!). I'm actually a Marxist - of... More
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PandA Trader - High-Yield (7%+) Dividend Stocks with High Annual Return (30%+) & Other Adventures in Trading the Day
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  • $CEFL & $MORL, And Why I Add Them To My Holdings. $STUDY

    I recently started investing in a couple of double-leveraged ETN's, where I had never invested in any ETNs before. I had read an article on Seeking Alpha about CEFL and that initially picqued my interest. I looked on stocktwits for more info on the 2 ETNs that were mentioned; CEFL and MORL, but there were no comments yet with the first comment on April 15th on stocktwits regarding CEFL by @regnard: "$CEFL Any comment on this ETN?". As of this writing, there are a total of 4 comments, all from that same day, from the original poster and myself. There were many more comments on MORL started on Dec. 23rd by @mREITlover (Bill Schultz): "$MORL is an Exchange Traded Note (UBS vehicle) providing Monthly compounded 2x leveraged exposure to the $MORT Index, less fees." (his 3rd comment within 3 minutes). Since stocktwits provided very little in the way of discourse on these double-leveraged ETNs, I turned to Seeking Alpha, knowing full well that some of the commenters/'authors' there have very little if any qualification to opine on any subject. Nevertheless, I decided to heed the advice of Prof. Lance Brofman and the anonymous 'Left Banker' as Prof. Brofman's curriculum vitae on Seeking Alpha deemed him a valid source, and 'Left Banker' spoke with quite a bit of reason and imparted some knowledge as well. My thanks to both of them for their freely imparted wisdom.

    I read the articles on Seeking Alpha on both ETNs (and comments, of course, of which they are both varied and voluminous!). The articles and comments provided quite a learning experience, with many opinions and facts offered in the process. There have been some wild accusations and some well thought out responses, and it was very hard for this neophyte to discern which was which. But, after reading all the articles and comments on Seeking Alpha through April 2nd I had made my mind up; I would invest in a starter position in both of these ETNs, so I ponied up my $49 for each one and plugged in my choices in my sharebuilder Roth IRA AIP (Automatic Investment Plan). I invested the same amount for 2 weeks, and then also added them to the other Roth IRA in our portfolio with cash from the sale of stock for a total investment to date of $1,757.00 for each ETN. Only my initial investment of $49.00 for each ETN in the first Roth IRA was before the ex-dividend date of April 9th. On April 22nd, CEFL paid $1.06 (a 25.96% annual return) and MORL paid $2.26 (a 55.35% annual return) on initial investments of $49.00 (made one day before the ex-dividend date). I intend to further invest no more than 2-5% of our total portfolio value in these ETNs, but only in our Roth IRAs. Currently, we have less than 1.5% invested and investment will be ongoing on an irregular basis until that threshold is reached.

    Now, a word on why I will only invest in these monthly paying ETNs in our Roth IRAs; since the dividends are taxed as 'ordinary income' it only makes sense to invest in the account(s) where the consequences of taxes has no bearing, i.e. our Roth IRA accounts. In any other account the tax consequences would be too high, and that would add to the already high implied risk with these double-leveraged ETNs.

    Please don't misconstrue this article as investment advice, because I am not qualified to offer same. I defer to more qualified sources. Do your own due diligence, and seek the advice of a qualified professional.

    Disclosure: I am long CEFL, MORL.

    Apr 27 2:57 PM | Link | 3 Comments
  • Month In Review; New Highs & Lows $AGNC $ARI $CODI $CYS $PMT $TWO $STUDY

    The High Yield, High Return Dividend Portfolio has come under some pressure over the past few days, so I thought it might be a good time to take a look at the price action over the past month. For this post, I will only focus on new highs/lows reached since September 17th.

    There have been 15 out of 29 stocks on the watch list that have reached new 1-year highs in the past month, and 9 more just prior to September 17th. 1 of these stocks went on to hit a new 6-month low on October 15th, and another 1 hit a new 3-month low on the same day. 13 of those stocks did NOT make new lows, and 23 stocks in total did NOT reach new lows this month. So, it's not all bad news.

    1 stock hit a new 6-month high today and closed at that high, and another hit a new 1-year high.

    Yesterday, October 15th, 6 stocks hit new lows; a 9-month low, 2 6-month lows, and 3 3-month lows.

    So, over the past month, these were the days that saw new highs or new lows;

    September 17th - AGNC hit a new 1-year high of $36.77, then hit a new 6-month low of $29.63 on October 15th, PSEC hit a new 1-year high of $12.25, and TCRD hit a new 1-year high of $12.25

    September 21st - AMTG hit a new 1-year high of $23.59

    September 24th - MCC hit a new 1-year high of $14.69

    September 25th - ARI hit a new 1-year high of $18.27, then hit a new 3-month low of $15.95 on October 15th, and RNF hit a new 1-year high of $40.05

    October 3rd - MFA hit a new 1-year high of $8.77, and NRF hit a new 1-year high of $6.66

    October 4th - KCAP hit a new 1-year high of $9.70

    October 5th - FDUS hit a new 1-year high of $17.05, and NCT hit a new 1-year high of $8.27

    October 9th - FSC hit a new 1-year high of $11.08, and TWO hit a new 1-year high of $11.08

    October 15th - AGNC hit a new 6-month low of $29.63, and ARI hit a new 3-month low of $15.95 (see above) after hitting new highs. Also hitting new lows; ARR hit a new 6-month low of $6.57, CYS hit a new 9-month low of $12.30, DX hit a new 3-month low of $9.23, and EFC hit a new 3-month low of $21.60

    October 16th - CODI hit a new 6-month high of $15.35 and then closed at that high, and PMT hit a new 1-year high of $24.74

    There are a lot of stocks on my watch list paying dividends this month, too!

    Oct 16 11:04 PM | Link | Comment!
  • Understanding "Special" Dividends - $SCMR $FSCI $STUDY

    FSCI and OTCPK:SCMR recently declared a "Special" Dividend. There seems to be a lot of confusion surrounding so-called "Special" Dividends.

    Part of this confusion, it could be argued, is that the FINRA website does not recognize or even mention the term; "Special Dividend".

    Try to search for it;

    • What makes a dividend "special'?

    A dividend becomes "special" when it is not regularly scheduled. Period.

    The End

    The rest of the story...

    FINRA is the 'authority' on dividends here. We must also turn to the National Association of Securities Dealers, Inc. (NASD®) because they are the governing authority on ex-dividend dates;

    Let's examine the slightly convoluted process of a dividend more closely;

    • Declare Date: Company declares a distribution to shareholders of cash or securities, and specifies the amount, payment date and record date in accordance with Securities and Exchange Commission (SEC) Rule 10b-17 that requires issuers to give notice of dividends and distributions to the NASD no later than 10 days prior to the record date.
    • Ex-Dividend Date: This is determined by the Record Date, and is set according to the National Association of Securities Dealers, Inc. (NASD®) Uniform Practice Code (UPC) according to NASDAQ Rule 11140, under one of two methods;
    1. The first method, under subparagraph(b)(1) of Rule 11140, provides that for dividends or distributions that are less than 25 percent of the value of the subject security, the date designated as the ex-date shall be the second business day preceding the record date.
    2. The second method, under subparagraph (b)(2) of Rule 11140, provides that for dividends or distributions that are 25 percent or greater of the value of the subject security, the ex-date shall be the first business day following the payable date.
    • Record Date: This is the date the company looks at it's books to ensure payment to shareholders of record.
    • Payment Date: This is the date payment is made.

    To be entitled to any cash dividend, all you need do is buy before the ex-dividend date, whether during regular trading hours or extended pre-market or after hours trading, and hold overnight. That's it.

    FSCI Fischer Communications issued a press release that explains it fairly simply, including the "Due Bill" process.

    You might want to check out NASD Notice to Members 00-54 regarding the Methods For Determining Ex-Dividend Dates.

    Also be sure to check out the FINRA UPC FAQ on Corporate Actions regarding dividends.

    Oct 09 10:06 AM | Link | Comment!
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  • $BGCP said a dividend increase was possible. EVERYBODY seems to have missed the dividend declaration in the ER. No site has it. NONE.
    Feb 12, 2015
  • $CEFL & $MORL, And Why I Add Them To My Holdings. $STUDY $CEFL, $MORL
    Apr 27, 2014
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