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  • Energy Recovery, Last Year And This One [View article]
    I just skimmed through their most recent white paper and the core of the IsoBoost, the "turbocharger" is in fact a combined turbine and pump at it's heart. But there are definitely a lot of design details - it's far from just a combination of an off the shelf turbine and pump. I'm not familiar enough with the area at this point to know if these are their innovations or not, how it differs from what's already been tried, etc.

    But I'm really liking what I'm reading so far and considering picking up some more shares after this drop.
    Jan 15, 2015. 02:46 AM | 2 Likes Like |Link to Comment
  • Energy Recovery, Last Year And This One [View article]
    I think this is a very (most?) important discussion regarding ERII. What is novel about their approach/technology? It seems according to this video ( ) the heart of the IsoBoost approach is infact a turbine(s). It seems like they have the high pressure feed go through a turbine that basically has another turbine (running in reverse, I.e. a centrifugal pump) attached to the other end. Now that's still a pretty broad description and the novelty may be in the details, but it seems that the pressure exchange does happen via turbines/centrifugal pumps...

    Even if it is true that the heart of the technology has been tried before, isn't it possible that they just got it right (in the details of their design) where others didnt? These initial reports from the plants that implemented the system seem to support that, don't they?

    I'll try to take a look at the patents to see the details. But I hope we can continue this discussion as it's been something on my mind for a while regarding this company / application.
    Jan 15, 2015. 02:14 AM | 2 Likes Like |Link to Comment
  • Money flows into Merk Gold Trust [View news story]
    While you can take out ounces from OUNZ, the minimum fee on the 1oz coins/bars is > $1200 and for 10oz bar still $1000... so unless you are working with London bars it doesn't seem like the redemption feature is actually that relevant if debating vs buying physical.

    Although I'm really not familiar with the physical market. I know some coins can be of higher demand etc, but in general could I walk out with an oz of gold tomorrow for pretty much the spot price?
    Oct 23, 2014. 07:29 PM | Likes Like |Link to Comment
  • Conflicts Of Interest: The Manager Got Your Money [View article]
    Great to hear! Looking forward to your future work.

    Many thanks.
    Jul 9, 2014. 04:10 PM | Likes Like |Link to Comment
  • Conflicts Of Interest: The Manager Got Your Money [View article]
    Great article. Have you considered turning this into a series of articles and doing the same analysis for other mREITs (and maybe other asset classes like BDCs)? I think you would find that many readers would be interested in this.

    I would personally request CYS and DX ;) Two of my favorite mREITs, and the *seemingly* shareholder friendly management is a big reason.
    Jul 9, 2014. 12:54 PM | Likes Like |Link to Comment
  • Mortgage REITs slide as Treasury yields take off [View news story]
    I bought more CYS and DX last week, so that tells you my thoughts there. My point is just that your original comparison of treasury yields and stock prices from last year to this year is meaningless. How the rates moved in between then is what impacts mREITs NAV and thus stock price.
    Jul 9, 2014. 10:10 AM | Likes Like |Link to Comment
  • Mortgage REITs slide as Treasury yields take off [View news story]

    The first bullet point:

    "A few days ago, the 10-year Treasury yield stood at about 2.50%, but it's been on the rise all week and shot up to near 2.7% this morning"

    magnitude of change / period of time = rate of change

    Plus, you really have to evaluate each mREIT individually, even if they own the same paper due to all the hedging they may or may not be doing. Regardless, it is how the rates are changing, not necessarily the absolute yield, that is important (and what destroyed the sector last year).
    Jul 3, 2014. 06:27 PM | 1 Like Like |Link to Comment
  • Mortgage REITs slide as Treasury yields take off [View news story]
    It's not the absolute yield that affects mREITs, it's the rate at which it changes.
    Jul 3, 2014. 10:34 AM | 2 Likes Like |Link to Comment
  • My 'Buy-The-Dip' High-Yield Portfolio: Security Selection [View article]
    continuing with the rates discussion. This is related to another theme of my strategy: give my money to the people who know more about economics/finance then I do, and let them try to make me money. The movements of rates and how to take advantage of them is basically the job of mREITs. I recommend listening to CYS conference calls sometimes, I really like their CEO Kevin Grant, and have learned a lot from him on this topic.
    Jun 29, 2014. 12:12 AM | 1 Like Like |Link to Comment
  • My 'Buy-The-Dip' High-Yield Portfolio: Security Selection [View article]

    I agree. I have yet to experience the real painful downsides that I KNOW will eventually come. I started getting into mREITs a couple months before they bombed last year. So I felt the pain, on what I had put in, but it wasn't much. I had a lot of room to double or even triple down and now I'm up 20% on a lot of mREITs + dividends; the strategy worked perfect. BUT, if it were to happen again, before I unload (i.e. deleverage) it may not be so easy or quick to make back the losses. This is obviously where the psychology comes in. It's so tough to get rid of your winners while they are still winning, especially if you can make the case that you think they will keep winning for the time being!

    You are smart to save your leverage for corrections, but remember it doesn't necessarily have to be a "market correction", right? The mREITs case is the perfect example. I know there are real risks of market corrections, with basically everything getting dragged down, but I don't really fear that. If/when it happens, sure maybe somethings deserved to be lower, but maybe some other things just got dragged along for the ride and are now on sale.

    As far as rates, where and how they will go, and the effects, I don't have any expertise in the area. But the last year seems to show me that NOBODY knows where/when they are going.
    Jun 29, 2014. 12:00 AM | 1 Like Like |Link to Comment
  • My 'Buy-The-Dip' High-Yield Portfolio: Security Selection [View article]
    hahaha yes I wasnt even gonna go there with the science careers similarity in the first post, but now this is just too much! so as long as we are keeping count (vi) we both use IB! and I'm probably going to be applying to some post-doc positions at Stanford in the near future so the list may go on!

    IB has 50% initial margin requirements for Reg T accounts but the maintenance margin is 25% (I think). So I'm pretty sure you should actually be able to ratchet it up to 4x... unless I'm missing something.

    I certainly didn't mean to discredit, shun etc retirees. I echo your gratitude as I have learned a ton from countless commenters and SA contributors like Steven Bavaria and Left Banker who adopt the high-yield strategy. But I also think there is a bit of, for lack of a better term, reaching for yield from retired SA commenters. I understand only caring about income and not capital appreciation, but there is a very real aspect of capital loss involved in many of these high yielders. Personally, I think my approach as a retiree would be to protect capital at all costs, which this type of portfolio certainly does not do. We can afford (time wise) to take the 20+% percent hits that are very possible with many of the BDCs, MLPs, mREITs etc. I almost welcome that these days, I mean, that's basically central to the strategy. But it feels like that would be a much scarier proposition if I was retired.
    Jun 28, 2014. 11:24 PM | 1 Like Like |Link to Comment
  • Energy Recovery: The Pressure Builds [View article]
    IB provides real time available shares and interest rate:
    Jun 28, 2014. 06:30 PM | Likes Like |Link to Comment
  • My 'Buy-The-Dip' High-Yield Portfolio: Security Selection [View article]
    Wow, an incredibly similar portfolio and approach to my own. I was considering writing an article to open up discussion about it since it is a bit unique... but you have taken care of that now! Thanks for the well written articles.

    My portfolio breaks down into the exact categories, but with "other" being CEFs (which yours pretty much is anyways) and I do have a small percent in traditional DGI equity. Allocation % are a bit different as well, but this is very much dynamic. In line with the "buy the dip" theory, I loaded up on BDCs this past month or two when they were down and did the same with mREITs last year (both moves have paid off tremendously). So those make up about 50% of my portfolio right now, which is clearly too much. I will start unloading some if they run up too high, and am selling calls in the mean time.

    I also add another wrinkle to the strategy (that many here will not like)... I am also young (29), and willing to put in the time/work and take on risk, so I own this all in a margin account that is currently 1.7~1.8 leveraged. (Yes, I know, leverage on top of leverage... insert: "what could go wrong")

    My portfolio yields north of 10%, a good portion paid monthly. I don't DRIP, bc as these dividends come in, they are continually reducing my leverage; both in terms of reducing interest costs, but also, and in some ways more importantly, they are exponentially building up my "dry powder" to buy the dips, and really make it count. If I get $500 in dividends, I can now now $1000 worth stock, IF the opportunity presents itself.

    I think there are also a number of interesting factors regarding these types of stocks that make them perfect candidates for the young investor buy the dips, sell the rips strategy. Namely, over reaction to the possibilities of dividend cuts. Even over reactions to actual cuts. Some extraordinary opportunities present themselves which end up giving you not only a high yield, but capital appreciation as well.

    Of course, I wouldn't expect anybody who is even somewhat close to retirement to have such a strategy. But I welcome and hope there is criticism/comments/dis... etc as it's been an interesting and insightful road developing and implementing it.
    Jun 28, 2014. 05:08 PM | 4 Likes Like |Link to Comment
  • Energy Recovery: The Pressure Builds [View article]
    Thanks for your info regarding shorts. I'm just getting into it and you explanations are very helpful.

    I think you use IB for rebate rates? Are you aware of any way to get 'days to cover' vs time chart in IB?

    Or do you see no need for this if you've got the rebate rate vs time.
    Jun 27, 2014. 05:20 PM | Likes Like |Link to Comment
  • ModernGraham Valuation Of Natural Resource Partners L.P. [View article]
    Exciting couple of weeks, ey?! I think I'm more on edge now after this crazy run up then I was when it was pushing 13! Selling some calls, but contemplating getting rid of some shares as well. Thoughts?
    Jun 24, 2014. 07:32 PM | Likes Like |Link to Comment