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BAWE

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  • I Hope The Exit Doors Are Wide Enough [View article]
    Isn't this far beyond just NLY? If the Prez gets a minimum wage even close to what he is seeking, it will set off a sudden disruptive inflation. It's anyone's guess what happens then, but it most probably will not be pretty.
    Jan 23, 2015. 03:02 PM | Likes Like |Link to Comment
  • What Warren Buffett Doesn't Want You To Do With Berkshire Hathaway Stock [View article]
    Thank you for the reply.
    We differ on this.
    I would not consider buying a call option on a stock that has had a good run up. There are better opportunities in stocks that have dropped and stayed down for a while, developing a solid bottom, and wringing out the call premiums. Then, if the company's prospects are favorable, buying a long call enables you to profit as the company's price rises to complete a saucer pattern. A great example of what I am saying is TEVA late last summer.
    Anyway, thanks for listening. Your article stimulated a great deal of thinking.
    B.
    Nov 5, 2014. 12:09 AM | Likes Like |Link to Comment
  • What Warren Buffett Doesn't Want You To Do With Berkshire Hathaway Stock [View article]
    Maybe you should refresh your knowledge of probabilities.
    It is true that NFL wins and losses are equal, but when the Pittsburg Steelers play the NY Jets next week you wouldn't want to put even money on the Jets.
    Probabilities are what drives market prices in the market, especially in the options market. Overwhelmingly, sellers of options are winners and buyers of options are losers. Buying options can be profitable, just like any other gamble. You would usually want to employ that strategy with a stock that has higher (than average) volatility and lower (than average) option premiums.
    Nov 4, 2014. 01:16 PM | 1 Like Like |Link to Comment
  • What Warren Buffett Doesn't Want You To Do With Berkshire Hathaway Stock [View article]
    I follow BRK closely, since it is the largest position in my portfolio.
    I always keep in mind that BRK is a lot like a mutual fund, in that its value (book value and market value) is almost wholly dependent on the price of the companies it holds. Thus, it would be significantly affected by a major market decline. Having said that, I obviously agree with the author's outlook for BRK.
    However, I disagree that buying call options is the way to increase one's position in BRK.
    I recall reviewing studies of the option market that demonstrated that option buyers have a 1 in 3 chance of making a profit, while option sellers have a 2 in 3 chance of profiting.
    If this is still true, an investor who agrees with the BRK outlook described by the author, and who wants to increase his return on BRK or the size of his investment in BRK, would be better advised to sell at the money puts on BRK. With this approach you would be ahead in all scenarios except a rapid rise in BRK before option expiration. If BRK dropped significantly, you would end up owning more BRK, which is what the author intends to do with his "dry powder".
    Just some thoughts.

    Nov 4, 2014. 08:59 AM | 1 Like Like |Link to Comment
  • Berkshire Bought Deere: Should You, Too? [View article]
    Given the expected decline in earnings, there should be a paragraph on forward P/E. Otherwise, a good article.
    I would like to see more about the seemingly large debt component of the capital structure. i.e. What is the average % cost of debt, and how much of the debt is variable rate?
    Also, How much of the cash is "trapped" overseas?
    Thank you.
    Sep 28, 2014. 08:20 AM | 4 Likes Like |Link to Comment
  • This New High Dividend Stock Is A Great Play On 2 Fast-Growing Markets [View article]
    Usually you can roll out the calls. This keeps you in the stock (dividend)) for a longer period and increases your return on the calls.
    Jul 17, 2014. 08:06 AM | Likes Like |Link to Comment
  • This New High Dividend Stock Is A Great Play On 2 Fast-Growing Markets [View article]
    Stuyoung--

    See http://bit.ly/sqR4tD

    "It is the responsibility of the custodian of the account to file a tax return (form 990-T) and pay any tax owed out of the account’s funds."

    I avoid putting MLPs in taxable accounts because I don't want to deal with the K-1s. I trade several MLPs in my IRAs and have never had a problem. Maybe I'm not as big an investor as you are.
    Jul 13, 2014. 09:24 AM | 1 Like Like |Link to Comment
  • Need 7-8% Yields In Retirement? Build Your Income Portfolio With Closed-End Funds (Part III: Discounts And Premiums) [View article]
    Great article.
    Jul 13, 2014. 09:06 AM | 2 Likes Like |Link to Comment
  • This New High Dividend Stock Is A Great Play On 2 Fast-Growing Markets [View article]
    I agree that the "LP" designation at the top of the article clearly distinguishes this from a C corporation.

    Why not just buy MLPs in your IRA accounts. No tax forms to worry about. Right?
    Jul 13, 2014. 08:23 AM | 2 Likes Like |Link to Comment
  • Armour Residential REIT: A Surprising Decline In Book Value [View article]
    At some point either the dividend is reduced or profits rise in order to maintain book value at an adequate level. If neither of these occur, you are correct.
    May 8, 2014. 11:10 AM | Likes Like |Link to Comment
  • Armour Residential REIT: A Surprising Decline In Book Value [View article]
    We certainly differ on this. Anyone buying a security with a 14% dividend yield should not expect an increase in book value or, for that matter in capital gains. In spite of what I just said, ARR has recently had a good run up from $3.75 where I bought it in December. Seems like an excellent hold for a portion of an IRA account, with dividends reinvested.
    May 7, 2014. 09:56 AM | 3 Likes Like |Link to Comment
  • Armour Residential REIT: A Surprising Decline In Book Value [View article]
    When dividends exceed income doesn't book value decrease? Why would you expect ARR's book value to increase?
    May 6, 2014. 02:55 PM | Likes Like |Link to Comment
  • Boeing: 50% Dividend Hike Good, Buybacks Destroy 30% Of Shareholder Value [View article]
    As pointed out by Indra's comment, the author should reconsider his thesis.
    While current PE ratios are interesting, they are not dispositive in determining the correct timing to buy a stock. Obviously, the expected future price of the stock is the critical factor, and I do not see that considered by the author.
    If expected future earnings increases justify a high PE ratio, a stock buyback is rewarding to shareholders in several ways, including reducing the burden of dividend increases so that we can have even more dividend increases.
    Jan 1, 2014. 10:10 AM | 5 Likes Like |Link to Comment
  • The Big Five: Which Would You Be Willing To Own If They Closed The Market For 20 Years? [View article]
    This article was interesting to me because it suggested a different way to compare stocks, although the conclusion, as it relates to the five companies selected, was fairly obvious.
    It would be useful to apply the same approach to other groups of companies. For example, the five largest pharma companies or the five largest financial companies.
    Thanks.
    Dec 20, 2013. 07:45 AM | Likes Like |Link to Comment
  • The 4% Plan: Adjusting Your Sails For 2014 [View article]
    Interesting thesis -- but it's unclear how you achieve a 4% return from dividends. I believe SPY yields around 2%.
    Dec 18, 2013. 08:23 AM | Likes Like |Link to Comment
COMMENTS STATS
82 Comments
55 Likes