Wednesday, July 19, 2017

Observations and Sample of Recent Trades: EBGUF, FENY, MET, XHR, XRE:CA, ZRE:CA

Economic Reports:

This is a good summary of recent economic reports: Another Bout of Deflation Ahead?


Dollar Bears' Case Grows Stronger as Wagers on Fed Hikes Fade - Bloomberg


U.S. Dollar Index (DXY) Interactive Chart
Bloomberg Dollar Spot Index 

New U.S. Subprime Boom, Same Old Sins: Auto Defaults Are Soaring - Bloomberg


OPEC Quietly Opened the Taps in June: Bloomberg


China Economic Expansion Exceeds Estimates on Factory Rebound - Bloomberg

Builder sentiment stumbles to 8-month low on higher lumber costs - MarketWatch

However, the housing starts for June, released this morning, were better than expected. Housing starts jump as construction, home buying get back on track - MarketWatch

The economic numbers so far in 2017 are no better than those reported in 2016. Yet, the S & P 500 ETF SPY has produced a 16.42% total return since 11/8/16. DRIP Returns Calculator | Dividend Channel

++++++++


TrumpCare:


TrumpCare has failed in the Senate. Senator McConnell has stated hat he will try a clean repeal bill with no replacement. Trump Blames Democrats and a ‘Few Republicans’ for Health-Bill Wreck - Bloomberg There are not enough votes for a repeal bill. McConnell's New Obamacare Repeal Lacks GOP Votes to Pass - Bloomberg


The republicans had no problem in voting repeatedly for a repeal only bill when Obama was President, knowing that he would veto the legislation. It is easy to howl out the wind. I seriously doubt that a repeal bill will pass when the republicans know that Trump will sign it into law. 

And, the republicans have persistently tried to sabotage Obamacare and will likely continue doing so. 


Republicans Raised Your Health Care Premiums, Not Obamacare | Policy Dose | US News and World Report 


How the G.O.P. Sabotaged Obamacare - The New York Times


The GOP masterminds behind the Obamacare sabotage - The Washington Post


This Trump delay may push Obamacare rates 20 percent higher next year: CNBC

Health Insurers’ Next Obamacare Scare Is Just Two Days Away - Bloomberg

While the GOP could withdraw their efforts to destabilize the exchanges, a super majority of republican politicians appear willing to continue their efforts:


Trumpcare Mess Leaves Health Industry in Legislative Limbo - Bloomberg

Donald Trump just tweeted 2 totally contradictory solutions to the health care collapse - CNN

Another interest group lined up against TrumpCare shortly before its demise:  

Insurers blast Senate Cruz amendment as 'unworkable' - Jul. 15, 2017 "The Cruz amendment "is simply unworkable in any form and would undermine protections for those with pre-existing medical conditions, increase premiums and lead to widespread terminations of coverage for people currently enrolled in the individual market," wrote the CEOs of America's Health Insurance Plans and the BlueCross BlueShield Association.")


Insurance groups tear into Cruz amendment to health care bill as "unworkable" - CBS News


There is no relationship between what the GOP says will happen and what will happen. Pence recently claimed for example that no one would lose their Medicaid benefits even though funding was being slashed because the private insurance companies would compete and drive prices down sufficiently to make up for that loss in federal funding. 


++++


Trump


So it turns out that the Russian Rinat Akhmetshin, who met with the Trump Team in NYC, is an accomplished orchestrator of email hacking efforts. Soviet Veteran Who Met With Trump Jr. Is a Master of the Dark Arts - The New York Times


The FBI needs to go full throttle investigating that guy. All document relating to that guy's activities over the past two years need to be acquired quickly.  


An eighth person has been identified as attending this meeting, Ike Laveladze, who has had a prior history of laundering Russian money. ("A congressional inquiry into money-laundering by foreigners using shell companies led to a report by the Government Accountability Office that found Kaveladze had established 2000 U.S. corporations and accounts that moved $1.4 billion through American banks." Ike Kaveladze Named as Eighth Person in Trump Meeting - NBC News)

Trump Jr.’s Russia meeting sure sounds like a Russian intelligence operation - The Washington Post (article written by Rolf Larssen who worked for 23 years as a CIA intelligence officer) 


Trump, Putin Had Second, Previously Undisclosed Meeting at G-20 Summit - NBC News (only Russia's interpreter joined the meeting)

Bipartisan Group That Shares Voter Data Shames Trump Panel - NBC News
Despite Trump promises, White House falling short in opioid fight - CBS News


ERIC (Electronic Registration Information Center)


How many Trump products were made overseas? Here’s the complete list. - The Washington Post



++++++++++++


1. Minor Changes in Extremely Underweighted Energy Sector Allocation:


I discussed some reasons for adding gingerly to my energy allocation in this post: Item # 4 Bought Back AMU at $17.58-Stocks, Bonds & Politics: Observations and Sample of Recent Trades: (AMU)


The general thesis is that the market may be surprised by the growth in demand outpacing the growth in production.


Current EIA Projections:





Short-Term Energy Outlook - U.S. Energy Information Administration (EIA)


Global crude oil balances expected to tighten through 2018-U.S. Energy Information Administration (EIA)


In this week's Barron's, Andrew Bary discussed the production problem and particularly the urge to drill for more oil with no positive returns on capital. 8 Great Energy Stocks at Bargain Prices - Barron's The 8 recommendations are Exxon, Chevron, Suncor, Canadian Natural Resources, Apache, EOG Resources, Cabot and Range Resources. Perhaps the most convincing case was made for Chevron based on its Gorgon natural gas field off of Australia's cost, the Australia Wheatstone Project and a good land position in the U.S. Permian Basin. I may buy a few shares. 


It is insane for E & P companies to spend billions on uneconomical production hoping that crude oil will soon return to $70 to $140 a barrel rather than being range bound between $40 to $60 for several years.


One analyst mentioned in the article claims that the big five have incurred $1.2 trillion in capital spending over the past decade, adding $200B in debt to their balance sheets, and have not increased production.


A. Bought Back 50 FENY at $17.85 (commission free ETF at Fidelity)

Trade Snapshot: 




Holdings as of 6/26/17-Greater Than a 1% Weighting: 


FENY | ETF Snapshot - Fidelity (Expense ratio .084%) 

Item # 5 Sold 50 FENY at $27.81 (8/6/14 Post)(profit snapshot=$115.96)-Item # 2 Bought 50 FENY at $25.49 (3/10/14 Post) 

B. Added 15 PEO at $18.69 (used commission free trade)




Quote: Adams Natural Resources Fund (PEO)


Adams Natural Resources is an unleveraged CEF that owns natural resource stocks. Commodity stocks have been a sector to avoid for about three years now. The three year annualized total return of this fund through 7/12 was -10.81% based on net asset value per share and -9.54% based on price.  Adams Natural Resources Fund (PEO) Total Returns


Those numbers are slightly better than the Energy Select Sector SPDR® Fund (XLE) and close to the total negative returns of  iShares North American Natural Resources ETF (IGE).


Data Date of Trade (7/12/17)

Closing Net Asset Value Per Share  $21.61
Closing Market Price $18.71
Market Price Discount to NAV Per Share = -13.43%
PEO Adams Natural Resources-CEF Connect 

Expense Ratio .79%


PEO 2016 Annual Report  (net unrealized appreciation as of 12/31/16 was at $188.273+M)


PEO is currently rated 4 stars by Morningstar.


I eliminated my PEO position in 2013 and have gradually been reacquiring shares and reinvesting the dividends. Item # 1 Sold 104+ PEO at $27.06 (8/10/13 Post)(total return 14.24%/one year holding period)


I now own 168+ PEO shares.


The fund is currently committed to an annual distribution of at least 6%.





C. Sold 100 EBGUF at $25.51 After Previously Adding to ENF:CA


EBGUF is the USD priced ordinary shares that trade in the U.S. Grey Market. I still own the ordinary shares priced in CADs and have recently added to that position. 


Quotes: 


EBGUF Stock Price - Enbridge Income Fund Holdings Inc.  (U.S.: OTC) 

ENF Stock Price - Enbridge Income Fund Holdings Inc. (Canada: Toronto) 

Overview - Enbridge Income Fund


I bought this lot as a trade, primarily to play an upswing in the CAD/USD and to collect a few dividends. I mentioned in a recent comment buying a number of USD priced Canadian stocks as short term trades. 



Profit: $53



On the date of purchase (4/19/17), EBGUF closed a $24.88 and ENF:CA closed at $33.6


Yesterday, ENF:CA closed at C$32.21, down 4.14% from its 4/19 close.

EBGUF closed yesterday at $25.51, up 2.53% from its 4/19.

The difference in performance is due solely to the CAD rising in value against the USD. Ideally, I would have wanted a Twofer, where the CAD gains in value against the USD and the ordinary shares priced in CADs also increase.

My last discussion of a ENF:CA purchase was in a comment. My last purchase of the CAD priced shares was at C$32.25 (6/9/17)


The last blog discussions of this company were several years ago:

Item # 1 Sold 100 ENF:CA at C$27.65 (8/2/14 Post)Bought: 100 ENF:CA at C$23, 50 SLGPRI at $22.69 (11/6/13 Post)

Dividends are paid monthly.




2. Equity REIT Common and Preferred Stock Basket Strategy:


A. Bought 100 XRE:CA at C$16.39 (C$1 commission):




Quote: XRE Fund - iShares S&P/TSX Capped REIT Index ETF Overview




Sponsor's Page: iShares S&P/TSX Capped REIT Index ETF | XRE


Dividends: Monthly at C$.06847




B. Bought 100 ZRE:CA at C$19.82 (C$1 Commission)




Quote:  BMO Equal Weight Canadian REITs Index ETF (ZRE:CA)


This ETF will have dramatically different weightings than XRE discussed above. 





ETF Products- BMO Asset Management Inc.


All Canadian REITs pay monthly distributions. 


This ETF pays a monthly dividend of C$.088 or C$1.056 annually. The yield is about 5.33% at C$19.82. 


Of the securities owned by this ETF, I own individually Artis, Cominar, Dream Global, Dream Office, and Northwest Healthcare. My largest position is 1,300 shares/units of Northwest Healthcare. 


C. Sold 50+ XHR Shares-Used Commission Free Trade


XHR Stock Price - Xenia Hotels & Resorts Inc. 


I sold on the ex dividend date. I harvested two quarterly dividend payments. One payment was used to buy shares and the other will be taken in cash. 


Trade Snapshot: 





Profit Snapshot: +$171.95






Recent News: 


Xenia Hotels & Resorts Completes $163 Million, 5-Hotel Portfolio Sale to Summit Hotel Properties


Xenia Hotels & Resorts Acquires Hyatt Regency Grand Cypress In Orlando For $205.5 Million


3. Short Term Bond/CD Ladder Basket Strategy:


A. Bought 2 Bank of Baroda 1.1% CDs Maturing on 8/30/17 (2 month Term):




B. Bought 2 Centerstate Bank 1.4% CDs 1/30/18 (monthly interest):




Holding Company:  Centerstate Banks Inc.  (CSFL)


C. Bought 2 Bank of India 1.2% CDs Maturing on 10/11/17 (3 month term):




4. Intermediate Bond/CD Basket Ladder Strategy:


A. Sold 2 Alabama Power 2.45% SU Bonds Maturing on 3/30/22:


Trade Snapshot:




Profit Snapshot: +$18.76





Finra Page: Bond Detail


Sold at 100.442

YTM Then at 2.349%
Current Yield at 2.44%
Net Proceeds = 100.342

Bought at a Total Cost of 99.403

Item # 1.D. 
YTM Then at 2.577%
Current Yield at 2.46%

B. Sold 2 CIGNA 3.25% SU Bonds Maturing on 4/15/25:




Profit Snapshot: +$17.32





Issuer: Cigna Corp. (CI)

CI Analyst Estimates

FINRA Page: Bond Detail


Sold at 100.423

YTM Then at 3.186%
Current Yield at 3.236%
Net at 100.323 (after $2 brokerage commission)

Bought at a Total Cost of  99.457

ITEM # 1.D.
YTM Then at 3.328%
Current Yield at 3.268%

D. Equity Residential Operating Partnership


I own several different Equity Residential senior unsecured bonds. Moody's raised the credit rating to A3 from Baa1.  Moody's upgrades Equity Residential to A3 and revises rating outlook to stable


Stocks, Bonds & Politics: Items 1.A. and 1.B
Stocks, Bonds & Politics: Item 1.D.


5. Continued to Pare Stock Allocation:


A. Sold 106+ MET Shares at $55.13: Eliminated Position:



Profit Snapshot: +$502.7




MET Stock Price - MetLife Inc. Stock Quote


MetLife Board of Directors Approves Spin-Off of Brighthouse Financial ("MetLife common shareholders will receive a distribution of one share of Brighthouse Financial common stock for every 11 shares of MetLife common stock they own as of the close of business on the July 19 record date. Following completion of the distribution, the price of shares of MetLife, Inc. common stock on the New York Stock Exchange will reflect the distribution of Brighthouse Financial, Inc. shares, and as a result may be lower than before the distribution.")


I did not want 11 shares of Brighthouse Financial and a lower MET stock price. I will evaluate later whether I will own either MET or Brighthouse, or neither.  


Disclaimer: I am not a financial advisor but simply an individual investor who has been managing my own money since I was a teenager. In this post, I am acting solely as a financial journalist focusing on my own investments. The information contained in this post is not intended to be a complete description or summary of all available data relevant to making an investment decision. Instead, I am merely expressing some of the reasons underlying the purchase or sell of securities. Nothing in this post is intended to constitute investment or legal advice or a recommendation to buy or to sell. All investors need to perform their own due diligence before making any financial decision which requires at a minimum reading original source material available at the SEC and elsewhere. A failure to perform due diligence only increases what I call "error creep". Stocks, Bonds & Politics: ERROR CREEP and the INVESTING PROCESS Each investor needs to assess a potential investment taking into account their personal risk tolerances, goals and situational risks. I can only make that kind of assessment for myself and family members.

Saturday, July 15, 2017

Observations and Recent Trades: BGEPRB, COFPRC, OHI, PFE, THGA

Trump's Lawyer Marc Kasowitz:

I can easily understand what Trump sees in Mr. Kasowitz after reading some emails that he sent to someone who asked him to resign as Trump's attorney. Kasowitz responded in five minutes to the respectful email:




15 minutes later, Kasowitz followed up with this email:





The man responded saying thanks for your reply and "I will be touch as appropriate".


Here is the reply to that email from Trump's attorney:




Trump Lawyer Marc Kasowitz Threatens Stranger in Emails: ‘Watch Your Back , Bitch’ - ProPublica


Trump lawyer Marc Kasowitz threatens stranger in emails: ‘Watch your back'


New York Consolidated Laws, Penal Law - PEN § 240.3: Aggravated Harassment in the Second Decree  


Kasowitz and Trump exhibit the same decree of class.


How does Kasowitz spell President? Donald Trump's lawyer has 'President' spelled wrong in very first sentence of his Comey testimony response | The Independent


In case anyone wants to know, Kasowitz believes "President" is spelled "predisent". No doubt part of the GOP effort to dumb down just about everything. Dumb is the New Smart.


Trump Lawyer Marc Kasowitz Will Apologize After Sending Email Threats - The New York Times


Sure, an apology is warranted, but it is not possible to close the window to his soul that is revealed by those emails. 


++++++


Trump Explains Why He Wants Solar Panels on the Mexican Wall That Mexico Will Pay For:





Trump explains why he wants to be able to 'see through' his border wall


I surely would not want to be hit with a 60 pound bag of drugs while standing on the U.S. side of Trump's Mexican Wall. Everyone needs to see the bag coming so they can dodge it.


If I reasoned and talked like that, I would have to cut out my tongue as the only way to avoid constant embarrassment. If I had a twitter account, I would need to quit tweeting as well.


I wonder whether Trump would have been successful in creating his brand Trump, with all the glitter of gold and financial acumen, if he had titled that book "Art of the Deal" more appropriately-something like "How to Lose One Billion in A Year" or "What Did I Learn after Four Bankruptcies: Create a Brand and License My Name".  


I wrote ‘The Art of the Deal’ with Trump. His self-sabotage is rooted in his past. - The Washington Post


++++++


47% of Republicans are okay with Trump's attempt to collude with an adversarial foreign power in a U.S. Election  


In a poll, 47% of republicans believe that the meeting attended by Trump Jr, Kushner, Manafort and the Kremlin linked attorney was appropriate. The meeting was held to receive "a thing of value" from Russia to be used in a political campaign against Hillary. Poll: Majority think Trump Jr. meeting with Russian lawyer was inappropriate | TheHillLegal experts say Donald Trump Jr has just confessed to a federal crime - Vox11 CFR 110.20 - Prohibition on contributions, donations, expenditures, independent expenditures, and disbursements by foreign nationals (52 U.S.C. 30121, 36 U.S.C. 510). | US Law | LII / Legal Information Institute


+++++


More Shoes Drop about  the Trump Team's Recently Disclosed 6/9/16 Meeting with Russians


We now know that Trump's Team wanted to collude with the Russians, despite multiple prior denials; the Trump Team knew that the Russians wanted to elect Donald; and the quid pro quo for damaging information about Hillary was a withdrawal of U.S. sanctions against Russia. To maintain otherwise, it would be necessary to ignore the plain meaning of words contained in the emails released by Don Jr. 


Yesterday, CBS reported that there were other, previously undisclosed persons in attendance at this meeting, including a person viewed my many as a Russian counter-intelligence officer Rinat Akhmetshin who probably is an acting Russian intelligence officer operating full time in the U.S.. Former Soviet Counterintelligence Officer at Meeting With Donald Trump Jr. and Russian Lawyer - NBC News  The entire episode now has  aroma of a three alarm fire of a Russian intelligence operation. 

In an April 2017 letter, the republican senator Charles Grassley claimed that Akhmetshin was a Russian intelligence officer who specializes in "subversive political influence operations often involving disinformation and propaganda". 2017-04-04 CEG to DHS (Akhmetshin Information) with attachment.pdf  


Trump Tower Russia meeting: At least eight people in the room - CNN 


Another person at the meeting has been identified as Anatoli Samochornov, a Russian-born American translator who has refused to acknowledge his attendance citing a non-disclosure agreement, although his mother and Akhmetshin confirmed his attendance.  The Translator Swept Up in Donald Trump Jr.'s Russian Dirt Hunt Possibly, Anatoli might be the only person in attendance who is willing to tell the truth about what transpired in that meeting.  


According to the WSJ, the Russian lawyer has now admitted being in close contact with Putin's Prosecutor General Yury Chaika who is a member of Putin's inter circle.  

Russian lawyer who met with Trump Jr. was in touch with top Russian prosecutor | TheHill

It is believed that the reference to Crown Prosecutor by the Brit Ron Goldman in the email chain is to Chaika. What is the crown prosecutor of Russia referenced in Donald Trump Jr.'s emails - Business InsiderThe luxury hotel, the family of the top Moscow prosecutor and Russia’s most notorious gang-The Guardian

Chaika. An investigative documentary by the Anti-Corruption Foundation - YouTube


There used to be a time when Republicans would be aghast at a Presidential candidate cooperating with the Russians to win an election, but those days are in the distant past. Only 22% of republicans disapproved of Trump's attempt to collude with the Russians according to the poll referenced above. I am surprised that there are anywhere near 22%.    


Some GOP holdovers from the old school are willing to call it collusion. {Charles Krauthammer' article titled Donald Trump Jr. E-mails Demonstrate Immoral Collusion, Criminal or Not | National Review}


Some Trump supporters were interviewed and gave predictable and programmed opinions about Russia's interference in the election and Don Junior's meeting with the Russians. Despite Trump Jr.'s meeting and swirling rumors, supporters sticking with the president - Videos - CBS News  If Trump says that Don Jr. is being transparent, for example, the Trump supporters will parrot that claim. 

It is odd to hear so many GOP politicians singing Putin's praises. Reverence for Putin on the Right Buys Trump Cover - The New York Times  


The underlying theme is support for anti-Democratic and authoritarian leaders who are hostile to a free press since the free press challenges their propaganda, lies and reality creations. I would not under estimate the threat to our Democracy or the progress this nation has made in the past 100 years.     


++++++

Senate GOP Health Bill Would Raise Out-of-Pocket Costs in Every State: Bloomberg


Governors From Both Parties Denounce Senate Obamacare Repeal Bill - The New York Times


New details emerge on Moscow real estate deal that led to the Trump-Kremlin alliance


Trump-Russia investigators probe Jared Kushner-run digital operation - Chicago Tribune


Investigators look for links between Trump, Russia cyber operations | McClatchy Washington Bureau (“There appears to have been significant cooperation between Russia’s online propaganda machine and individuals in the United States who were knowledgeable about where to target the disinformation”)


Ivanka Trump clothing line practices are out of step with industry trends - Washington Post (so much for America First and improving the lives of working women being Ivanka's "life's mission")


+++++


Economic Reports


Weak economic reports released yesterday gave sustenance to the Bond Ghouls, and the Stock Jocks continued to party since all news is interpreted as good news now. 


Friday's Closing ETF Prices: 


Positive: 


S & P 500  2,459.27  +11.44 0.47% 

EEM $43.42 +$0.54 1.26%: iShares MSCI Emerging Index ETF 
IEF $106.40 +$0.15 0.14%: iShares 7-10 Year Treasury Bond ETF 
LQD $120.57 +$0.28 0.23%: iShares Investment Grade Corporate Bond ETF
VNQ $83.08 +$0.79 0.96%: Vanguard REIT ETF 
XLU $51.92 +$0.24 0.46%: SPDR Select Sector Utilities ETF 
GLD $116.79 +$0.97 0.84%: SPDR Gold Trust 
Crude Oil - Electronic Aug 2017 Price $46.68 +.6 +1.3% 
CADUSD .7909 +.00058 +.74% 
AUDUSD .7845 + .0113 +1.467% 
NOKUSD .1224 +1.019% 

Negative: 


DXY - U.S. Dollar Index (DXY) 95.11  -.65 -.68% 

KRE $55.02 -$0.35 -0.63%: SPDR S&P Regional Banking ETF 
C $66.72 -$0.30 -0.45%: Citigroup, Inc.  
JPM $92.25 -$0.85 -0.91%: JP Morgan Chase & Co. 
WFC $54.99 -$0.61 -1.10% : Wells Fargo & Company 

Inflation in June was zero. Core CPI rose a mere .1%, seasonally adjusted, and has risen 1.7% Y-O-Y. 



Consumer Price Index Summary

Retail sales declined .2% in June. Retail sales ex-gasoline were down .1%. Monthly Retail Sales Report.pdf


The Atlanta FED has decreased its estimate for real GDP growth to 2.4% this quarter. GDPNow - Federal Reserve Bank of Atlanta


As of 7/17/17, the New York FED's model is predicting 1.9% GDP growth for the current quarter and 1.8% for the third quarter. FEDERAL RESERVE BANK of NEW YORK


"Industrial production rose 0.4 percent in June for its fifth consecutive monthly increase. Manufacturing output moved up 0.2 percent; although factory output has gone up and down in recent months, its level in June was little different from February. . . .  At 105.2 percent of its 2012 average, total industrial production in June was 2.0 percent above its year-earlier level. Capacity utilization for the industrial sector increased 0.2 percentage point in June to 76.6 percent, a rate that is 3.3 percentage points below its long-run (1972–2016) average." The Fed - Industrial Production and Capacity Utilization - G.17


+++++++++++++

1. Intermediate Bond/CD Ladder Basket Strategy

A. Sold 2 CSX 2.6% SU Bonds Maturing on 11/1/26

Trade Snapshot: 


Profit Snapshot: $48.06



Finra Page: Bond Detail

Sold at 97.1
YTM Then At 2.957%
Current Yield at 97.1 = 2.68%
Net at 97 (after $2 brokerage commission)

Bought at Total Cost of 94.597
YTM Then at 3.255%
Current Yield at  94.597 = 2.75%

B. Sold 2 Hershey 2.625% SU Bonds Maturing on 5/1/23:


Trade Snapshot:



Profit Snapshot: +$38



FINRA Page: Bond Detail


Sold at 101.918

YTM Then at 2.258%
Current Yield at 101.918 = 2.58%
Proceeds at 101.718 ($4 Vanguard commission)

Bought at Total Cost of 99.818

YTM Then at Total Cost = 2.658%
Item # 1.B
Current Yield at 99.818 = 2.65%

C. Sold 2 Pepsico 2.75% SU Bonds Maturing on 4/30/25:


Trade Snapshot:




Profit Snapshot: +$22.22




FINRA Page: Bond Detail

Issuer:  PepsiCo Inc.

Sold at 100.5

YTM Then at 2.677%
Current Yield at 2.74%

Bought at a Total Cost = 99.189

Item # 1.C.
YTM Then at 2.864%
Current Yield at 2.77%

D. Sold 2 Verizon 2.625% SU Bonds Maturing on 8/15/26:


Trade Snapshot:





Profit Snapshot: +$25.18




FINRA Page: Bond Detail


Sold at 93.499

YTM then at 3.468%
Current Yield at 2.81%
Proceeds at  ($2 commission-$1 per bond)

Bought at a Total Cost of 92.09

Item # 1.A.
YTM then at 3.63%
Current Yield at 2.85%

E. Bought 1 Dynegy 8.034% SU Bond Maturing on 2/2/24: This is a high risk junk rated bond:




Issuer: DYN Stock Price - Dynegy Inc.

Finra Page: Bond Detail (prospectus not linked)
Credit Rating:
Moody's at B3 for Senior Unsecured
Moody's affirms Dynegy's B2 CFR; assigns Ba3 rating to $2 billion secured term loan; outlook is stable
S & P at B+

YTM at Total Cost (95.6) = 8.928%


DYN Analyst Estimates

2017 First Quarter Results



2016 Annual Report (debt discussed starting at page F-31)


The potential benefit of this purchase is that $956 can generate close to the same income as $3K tied up in high quality bonds maturing in 2024. The risk is that the company will dive into bankruptcy before the bond matures and produce a far lower return than just 1 investment grade bond with a 3% YTM. 

$7K in Net Dispositions

2. Short Term Bond/CD Ladder Basket Strategy:


A. Bought 2 WFC 1.45% CDs (monthly interest) maturing on 7/30/18


All of the Wells Fargo CDs that I have purchased pay monthly dividends.


B. Bought 2 Bank of China 1.1% CDs Maturing on 9/15/27 (2 month term):




I have a First Bank .65% CD  and a Bank of China .75% CD, both maturing on 9/15/17 and having 6 month terms. So I am continuing to pick up more yield with shorter terms.


3. Continued to Pare Stock Allocation:


A. Sold 100 PFE at $34.03:


Position Before Pare:




Trade Snapshot (Used Commission Free Trade):





Profit Snapshot: +$143.42



As previously stated many times, I have a negative opinion about Pfizer and simply view the stock as a bond substitute. I try to collect a few dividends, sell my highest lots profitably, and potentially buy back small lots at lower prices. 


In a post published on 3/13/17,  I discussed selling another 100 share lot at $34.65, held in my Vanguard taxable account, realizing a $235.86 gain.  


Other Recent Trades: 


Item # 1 Sold: 100 PFE at $31.68 (5/17/14 Post)(profit snapshot $282.12)-Item # 3 Bought 100 PFE at $28.7 (8/14/13 Post)


4. Clean UP in IB Account:


For a variety of reasons, I ended up owning  less than 50 shares of BGEPRB, COFPRC and THGA in my IB account.


I sold all of those small odd lot positions:


29 Shares of BGEPRB

14 Shares of THGA
30 Shares of COFPRC



Group Profit Snapshot: +$103.59




All of those securities have $25 par values.


BGEPRB is in effect a junior bond issued in the trust preferred legal form of ownership. I bought 29 shares that was a partial fill of a 30 lot order. This lot was bought at $25.35 and was discussed here.


BGE Capital Trust II 6.2% Trust Pfd. Secs  (BGEPRB)


BGEPRB can be called at par value now. The underlying junior bond owned by this trust was issued by Baltimore Gas and Electric which has senior unsecured debt maturing in 2046 that is trading near a 3.5% YTM. Baltimore G & E 3.5% SU Bond Maturing on 8/15/46


TRUST PREFERRED SECURITIES - South Gent | Seeking Alpha

Stocks, Bonds & Politics: Trust Preferred Securities: Links in One Post

THGA is a junior unsecured baby bond. I had for some reason omitted selling 16 shares when I sold my last lot. I still own a 50 share lot bought in a Roth IRA at $24.7, which I discussed briefly here. 


Hanover Insurance Group Inc. 6.35% Subordinated Debenture due 2053 (THGA)


Trading Profits THGA = $181.35


Stocks, Bonds & Politics: Exchange Traded Baby Bonds


The first trade was a 50 share buy in 2014: Sold THGA: 50 Shares at $23.46-Roth IRA and 50 Shares Taxable Account at $23.67 (5/17/14 Post)(profit $143.84)-Item # 3 Roth IRA: Bought 50 THGA at $21.58 (11/6/13 Post) 


I last discussed THGA in Item # 4 (sold 50 shares at $25.36) 


I currently own 100 THGA shares. Of those shares, 50 are owned in a Roth IRA and were bought last December at $24.7. At about the same time, I bought 50 shares in a taxable account, which I still own, at $24.87.


I have no recollection buying 30 shares of COFPRC, a non-cumulative equity preferred stock issued by Capital One. A gremlin bought this lot at $24.84 on 12/16/16 and I did discuss that purchase here.


Capital One Financial Corp. 6.25% Non-Cumulative Preferred Series C Stock


I routinely buy small lots of Capital One preferred stocks when the yield goes over 6%. I may change to buying its senior unsecured bonds.


I still own 50 shares of COFPRH bought at $24.46.


Capital One Financial Corp. 6% Non-Cumulative Preferred Series H Stock Quote



5.  Equity REIT Common and Preferred Stock Basket Strategy:


A. Pared OHI-Sold 107 out of 188+ Shares at $34.55+:





Position Before Pare: Average Cost Per Share = $31.5





Position After Pare:




All of those shares were purchased commission free and consist of small odd lot orders and shares purchased with dividends.



Average Cost Per share for Remaining 88+ Shares = $30.22


Current Quarterly Dividend = $.63


Omega has been increasing the penny rate by 1 cent per share for several quarters. Dividends – Omega Healthcare Investors, Inc.


Current Dividend Yield at a Total Cost Per share of $30.22 and a $.64 Quarterly Rate = 8.47%


OHI recently raised its quarterly dividend to $.64 from $.63: Omega Announces Twentieth Consecutive Increase in Its Quarterly Common Stock Dividend and Release Date of Second Quarter Earnings and Conference Call 


Profit Snapshot: +$211.51




I sold 7 shares bought with dividends and two 50 share lots. The two 50 share lots were bought at a total cost per share of $32.35 (11/16/15) and at $32.81 (11/21/16). The 50 share lot bought in November 2015 survived the last paring where I sold shares at over $37.


I last sold last April a 50 share lot held in a Roth IRA: Item # 2.A.


Total OHI Trading Profits: $1,356.27


This recently published SA article summarizes the OHI pros and cons: Omega's 7.7% Yield: A Terrible Way To Invest - Omega Healthcare Investors, Inc (NYSE:OHI) | Seeking Alpha

In the event the GOP successfully capitates federal contributions to Medicaid, and links future increases to CPI when medical costs have historically risen at far faster rate, I suspect that nursing home stocks will suffer meaningful declines, even if the capitation and inflation adjustment starts in a few years. I would anticipate that OHI's stock price is fall quickly below $30 and possibly pierce $28 to the downside. At the moment, the GOP looks like it will not be able to agree on an Obamacare repeal and replace. That could change however.  

It is clear to me that institutional investors do not share the strong enthusiasm of individual investors for this stock. Over the past 3 years through last Friday, OHI's annualized average total return was 2.15%, and that is with a generous dividend to reinvested to buy more shares. The far lower yielding Vanguard REIT Index Fund ETF (VNQ) has posted a 7.54% average annual return over the same period. 

Another indicator that professional investors do not like this stock is a 28.53M short position which amounts to 21.18% of the float: OHI 

Stocks, Bonds & Politics: Omega Healthcare (OHI)(1/14/2017 Post)

Suntrust and Jefferies downgraded OHI from buy to hold last February. Jefferies reduced its price target to $32 from $35. 

Round trip trading snapshots can be found at my Gateway Post for the Equity REIT Common and Preferred Stock Basket Strategy.


Start Date: September 2013

Realized Net Profits: $16,440.36 as of 7/14/17 


Disclaimer: I am not a financial advisor but simply an individual investor who has been managing my own money since I was a teenager. In this post, I am acting solely as a financial journalist focusing on my own investments. The information contained in this post is not intended to be a complete description or summary of all available data relevant to making an investment decision. Instead, I am merely expressing some of the reasons underlying the purchase or sell of securities. Nothing in this post is intended to constitute investment or legal advice or a recommendation to buy or to sell. All investors need to perform their own due diligence before making any financial decision which requires at a minimum reading original source material available at the SEC and elsewhere. A failure to perform due diligence only increases what I call "error creep". Stocks, Bonds & Politics: ERROR CREEP and the INVESTING PROCESS Each investor needs to assess a potential investment taking into account their personal risk tolerances, goals and situational risks. I can only make that kind of assessment for myself and family members.