Economy:
The BLS reported that the economy gained 228K jobs in November. The October number was reduce to 244K from 261K while September was increased to 38K from 18K. Employment Situation Summary
Average hourly earnings increased .2% in November and 2.5% Y-O-Y. The work week increased .1 hours to 34.5.
The unemployment rate remained at 4.1%.
The U-6 number increased to 8% from 7.9%: Table A-15. Alternative measures of labor underutilization
Notwithstanding claims to the contrary, the job additions and wage numbers are actually down so far in 2017 compared to 2016.
BLS JOB GAINS BY MONTH: Bureau of Labor Statistics Data
10 months Starting in February
2016 = 2.114M
2017 = 1.7M (October and November Subject to Revision)
The September 2017 number was impacted adversely by the hurricanes but October and November will be stronger as a result. I start in February since the inauguration was on 1/20/17. Job growth will be lumpy month-to-month. I would basically call the 2017 number a continuation of the economy from the prior years. It would not be accurate to say that either job growth or wage gains have accelerated in 2017.
BLS Average Hourly Compensation: Bureau of Labor Statistics Data
Hourly Wage Increase: Through November-Start Point January
2016 +2.123%
2017 +2.04%
Average hourly wage growth by Year:
2016: 2.9% Employment Situation News Release
2015: 2.5% Employment Situation News Release
Lack of wage growth remains the economy's greatest mystery: CNBC
Focus on Shareholders Holds Back U.S. Wage Growth - The New York Times ("Many executives view repaying investors as a higher priority than increasing wages or hiring. Honeywell, Coca-Cola, Amgen and others have said they will use any tax windfall in part to increase dividends, buy back shares and repay debt.") I would add to that list increases in executive compensation and purchases of other companies that results in job layoffs.
Share buybacks spike — dropping a strong hint at what CEOs plan to do with tax savings-MarketWatch I would view it as positive longer term for companies to use repatriated cash to fund stock buybacks rather than to use cash raised by debt issuances which will likely have to be financed and refinanced over a long period of time, probably at higher interest rates.
After the passage of the GOP's tax reform, the incentives remain to hire workers and to build new plant in foreign nations where labor compensation packages are far cheaper and regulations less burdensome, particularly environmental and worker safety regulations.
Corporations will soon be able to save money on U.S. federal income taxes and to continue doing what they have been doing to lower costs. This is not a prescription to remedy economic stagnation in the middle class or to lift lower income households into the middle class.
As tax plan gained steam, GOP lost focus on the middle class
++++
Portfolio Management:
I have increased significantly over the past several weeks my allocation to short term bonds and CDs. Interest rates payable by higher quality short term corporate bonds maturing in 12 to 18 months are now fairly common in the 1.9% to 2.2% range.
As I add to corporate bonds maturing in 2019, I am selling those that mature in 2023-2026 that only provide slightly higher YTMs with meaningfully more interest rate risk considering the reasonably anticipated future course of interest rates.
It will be several weeks before I discuss all of those recent purchases.
I have discussed one of those bonds, an Anheuser 1.9% SU bond maturing on 2/1/2019. Bond Detail I have added to that bond when my all-in cost was less than par value. My first buy was at less than par value but the $1 brokerage commission took me slightly over par value: Item # 5.G. (11/20/17 Post)
By going out a few more months, I was able to buy last Friday 2 Comerica 2.125% SU bonds maturing in May 2019 at a 2.171% YTM based on my total cost. Bond Detail (that is my trade at 15:04 on 12/8) CD rates maturing at about the same time have coupons between 1.75% to 1.8%. To pick up 2.2% in a CD, I would have to go out to December 2021:
BlackRock Is Buying the Bonds Most at Risk From Added Fed Hikes - Bloomberg (12/9/17 article) ("To BlackRock Inc.’s Rick Rieder, lost in the discussion about the flattening U.S. yield curve is the fact that shorter-dated Treasuries are the cheapest on a relative basis in a decade")
The compression in the ten minus two year treasury spread means that 2019 and 2020 treasury maturities provide most of the yield offered by those maturing in 2026-2030 with much less interest rate risk. The same is generally true for similarly rated investment grade corporate bonds.
Then, it becomes a question whether the investor is predicting that intermediate term rates will likely rise over the next several years, causing the intermediate term bonds to decline in value and/or interest rates for shorter maturities will rise significantly in 2018 and 2019 providing the investor with the opportunity to invest proceeds into higher yielding short term securities using a ladder type strategy that ultimately provides more income then intermediate term bonds within the next year. The bottom line is that 2018-2019 maturities seem to be the sweet spot in the bond risk/reward spectrum at the moment.
Investors Told to Brace for Steepest Rate Hikes Since 2006 - Bloomberg
My most successful strategy this year was to refrain from selling shares in my T. Rowe Price stock mutual funds.
+++++++
Market Commentary:
Randall Forysth's column in this week's Barrons:
The Greatest Investment Bubble - Barron's (subscription publication)
Forsyth does not identify the biggest investment bubble, but merely the potential contenders.
He does identify Bitcoin and other cryptocurrencies as being in a potential bubble. That market has probably eclipsed $300B in size. Sooner or later, governments are going to clamp down hard using their many investigative powers to peel back anonymity. I seriously doubt that Bitcoin traders are reporting their trading profits on Schedule D. I have never bought any cryptocurrency. Tulips anyone?
'Bitcoin crash’ among significant market risks in 2018, says Deutsche Bank: CNBC
Memoirs of Extraordinary Popular Delusions and the Madness of Crowds
Another potential bubble that could be more problematic when and if it bursts involves abnormally low bond yields.
JPM estimates that there is still $10.1 trillion in bonds with negative nominal yields.
A much larger amount resides in bonds that have or will likely have negative real yields while providing a nominal current yield. The negative real yields are created by extremely abnormal monetary policies implemented by central banks that have been maintained for an extended period of time. The German 10 year government bond closed at a .309% yield last Friday. The Swiss government ten year bond has a negative nominal yield. Those yields are ECB and SNB created and do not reflect market based rates. Inflation in Germany this year is running at 1.7%, up from 1.68% last year.
Forsyth provides a quote from John Kenneth Galbraith that can be found in the 1997 edition of his book The Great Crash 1929, which is worth reading:
“There is here a basic and recurrent process. It comes with rising prices, whether of stocks, real estate, works of art, or anything else. This increase attracts attention and buyers, which produces the further effect of even higher prices. Expectations are thus justified by the very action that sends prices up. The process continues; optimism with its market effect is the order of the day. Prices go up even more.”
Some call the end game of this process the Minsky Moment. China central bank warns against 'Minsky Moment' due to excessive optimism; 'Minsky Moment' Hangs Over World Swimming in Debt: QuickTake Q&A - Bloomberg; Minsky’s moment - Financial stability
The bottom line is that the inflation in risk asset prices does not trickle down to most participants in the U.S. economic system.
Tax reform will not change that dynamic, but will cause the wealth gap between owners of capital and wage earners to go parabolic.
The economy still depends on spending from consumers who own no risk securities outside of a retirement plan and most of that limited exposure is relatively small for must households as shown by the most recent Survey.
Approximately 48% of households own no stock, inside or outside of a retirement plan. Dow Hits 21,000, Trump Touts Stock Market Success, But Many Left Out Of Gains : NPR
Tax reform will not change that dynamic, but will cause the wealth gap between owners of capital and wage earners to go parabolic.
The economy still depends on spending from consumers who own no risk securities outside of a retirement plan and most of that limited exposure is relatively small for must households as shown by the most recent Survey.
Approximately 48% of households own no stock, inside or outside of a retirement plan. Dow Hits 21,000, Trump Touts Stock Market Success, But Many Left Out Of Gains : NPR
Consumer debt has already surpassed the pre-Near Depression levels.
Sourced: The Center for Microeconomic Data - FEDERAL RESERVE BANK of NEW YORK
The GOP's tax reform will increase U.S. corporate profits and will have a less than predicted positive impact on wages. Wage gains for skilled employees, where there are shortages, will continue to rise.
Revenues from U.S. operations, and profits derived therefrom, will receive a bump from the GOP's tax plan. I anticipate that this increase will be far less than anticipated since most Americans in a consumer led economy will receive minimal tax savings and a significant percentage will suffer tax increases.
For many households, the GOP will also take away the meagre tax savings through one or more actions as previously discussed here. The wealth gap will go parabolic over the next three years.
In other words, the bedrock foundation for the economy--consumer spending by the bottom four quintiles--will be weakened-not strengthened- by GOP actions during the Trump administration.
When the Democrats regain control over the Senate, House and the Presidency, corporate tax rates will be raised, probably to 25% or higher from whatever level emerges in the GOP's tax legislation, thereby undermining one of the foundations for current U.S. stock prices.
Since the world is enjoying a synchronized growth now, which has been a rare phenomenon since the Near Depression, worldwide growth will add to U.S. GDP for as long as it lasts.
For now, there are no signs observable by me that the economy will soon enter a recession, though one is overdue based on history. The last recession ended in June 2009. NBER.org/cycles Since 1945, the average U.S. expansion cycle lasted 58.4 months. The current expansion cycle is currently at 8 years and 5+ months or about 101 months.
The GOP's tax reform will increase U.S. corporate profits and will have a less than predicted positive impact on wages. Wage gains for skilled employees, where there are shortages, will continue to rise.
Revenues from U.S. operations, and profits derived therefrom, will receive a bump from the GOP's tax plan. I anticipate that this increase will be far less than anticipated since most Americans in a consumer led economy will receive minimal tax savings and a significant percentage will suffer tax increases.
For many households, the GOP will also take away the meagre tax savings through one or more actions as previously discussed here. The wealth gap will go parabolic over the next three years.
In other words, the bedrock foundation for the economy--consumer spending by the bottom four quintiles--will be weakened-not strengthened- by GOP actions during the Trump administration.
When the Democrats regain control over the Senate, House and the Presidency, corporate tax rates will be raised, probably to 25% or higher from whatever level emerges in the GOP's tax legislation, thereby undermining one of the foundations for current U.S. stock prices.
Since the world is enjoying a synchronized growth now, which has been a rare phenomenon since the Near Depression, worldwide growth will add to U.S. GDP for as long as it lasts.
For now, there are no signs observable by me that the economy will soon enter a recession, though one is overdue based on history. The last recession ended in June 2009. NBER.org/cycles Since 1945, the average U.S. expansion cycle lasted 58.4 months. The current expansion cycle is currently at 8 years and 5+ months or about 101 months.
Trump:
How the GOP tax cut could take money away from most Americans
Trump policies starting to ‘crumble’ traditional U.S.-Europe ties, German foreign minister warns - The Washington Post
Arrests along Mexico border drop sharply under Trump, new statistics show - The Washington Post
Trump records robocall for Roy Moore ahead of Alabama special election - CBS News-Alabama Senate Candidate Roy Moore's Most Offensive Quotes | Time
Roy Moore: Last Time America Was 'Great' Was During 'Slavery'
Roy Moore: America Was Great During Slavery | Time
Trump records robocall for Roy Moore ahead of Alabama special election - CBS News-Alabama Senate Candidate Roy Moore's Most Offensive Quotes | Time
Roy Moore: Last Time America Was 'Great' Was During 'Slavery'
Roy Moore: America Was Great During Slavery | Time
++++
1. Bought Back 100 NRBAY at $11.54-Used Commission Free Trade:
Quotes:
Quotes:
USD Priced ADR: Nordea Bank AB ADR (NRBAY)
SEK Priced Ordinary Shares: Nordea Bank AB (Sweden: Stockholm)
1 ADR = 1 Ordinary Share
SEK / USD Currency Chart Swedish Krona to US Dollar Rates
There was a slight pop in the share price last Friday. I did not see anything specific to cause that price gain unless job cuts are viewed as a positive: Nordea Bank Starts Job Cuts in Finland Targeting 500 Bankers-Bloomberg
Closing Price 12/8/2017: NRBAY $11.80 +$0.43 +3.74% : NORDEA BANK AB
Nordea is the largest bank financial operating in the Nordic and Baltic Sea regions with approximately 650 branch offices and total assets of €615B.
Key Figures: 2014-2016
Fact sheet | nordea.com
I discussed my rationale for this purchase in this comment made one day after this purchase.
Last Trade: I sold 100 shares on the annual ex dividend date earlier this year. Item # 2.A. (profit snapshot= $72.17). The USD dividend amount per share was $.69+.
Dividends: Like many European companies, Nordea pays an annual dividend. Over the past several years, the ex dividend and payment dates were in March. Dividend | nordea.com
By virtue of Article 10 in Sweden's tax treaty with the U.S., Sweden will withhold a dividend tax of 15%, but the investor's broker has to claim U.S. citizenship tax treaty rights. Fidelity has in the past successfully asserted my right to a 15% withholding rate. (see snapshot of 2015 annual dividend payment under "Recent Developments") The filing that has to be made to secure the 15% rate is called "relief at source".
See 2017 Notice from the Depository Trust Company.pdf:
A failure to make a relief at source claim will result in a 30% withholding rate applicable to citizens from non-treaty countries:
Virtually all nations have a tax treaties with one another.
Third Quarter Report: Interim Management Statement Third Quarter 2017.pdf
Credit Ratings:
Nordea Sets Record Low Rates on its Riskiest Bank Bonds - Bloomberg
Other Blog Discussions:
Item # 2 Bought Back 100 NRBAY at $11.56 (12/24/14 Post)- Sold on 5/20/15: Update On Portfolio Positioning And Management - South Gent | Seeking Alpha (profit snapshot=$145.07)
Item # 6 Sold 100 NRBAY at $11.265 (2/6/13 Post)(profit snapshot=$175.06)-Item # 2 BOUGHT 100 of the ADR NRBAY at $9.36 (10/10/12 Post)
Trading Profits 2015-2017 = $392.3 (plus annual dividend)
2. Small Ball:
A. Added 10 AMU at $15.98-Used Commission Free Trade:
This purchase was made on the ex dividend date when this ETN declined by more than the value of the distribution.
This purchase brings me up to 71 shares in this account, with all market purchases being made using commission free trades. The first purchase was a 50 share lot bought at $17.75 (10/18/17) and the second was a 10 share purchase $16.73+ last month before the ex dividend date. I just received the quarterly distribution on 60 shares that was used to buy 1.078 shares at a TC of $16.69. My average cost per share is $17.34.
Closing Price Last Friday: AMU $16.63 +$0.02 0.12%: ETRACS Alerian MLP Index ETN
Profile: AMU is an Exchange Traded Senior Note issued by UBS that tracks before costs the Alerian MLP Index. AMU | ETRACS Alerian MLP Index ETN (click "key considerations" for sponsor's summary of risks)
The Alerian MLP Index consists of MLPs involved in various aspects of the energy business, including pipelines, production, storage, gathering and processing.
I generally keep my exposure to ETNs limited, since that form of ownership exposes me to the issuer's credit risk, in addition to the numerous risks associated with the index being tracked by the ETN as well as other risks relating to this kind of product. "Exchange-Traded Notes Avoid Unpleasant Surprises- FINRA; NYSE Publication: "What You Should Know about Exchange Traded Notes.pdf.
As discussed previously, the energy infrastructure MLPs generally have a small or no direct exposure to energy prices. However, those companies have high fixed costs and their cash flow is dependent on the volume of product that needs to be transported, stored or processed. A decline in energy prices can negatively impact production from several fields and consequently result in lower toll collections as fixed costs, including maintenance expenditures and debt servicing costs, continue going up.
The "tax reform" bill making its way through Congress does have a provision limiting the deductibility of interest and other matters regarding the taxation of distributions. I am not going to focus on these issues until a bill is signed into law. Senate Tax Bill Sets A Trapdoor For MLPs - Bloomberg; GOP Tax Plan Is a Win for Big Business | Fortune
Closing Price Day of Purchase (11/28/17): AMU $16.01 -$0.07 -0.44%: ETRACS Alerian MLP Index ETN (price adjusted for the $.2999 per share distribution; prior close at $16.38-Historical Prices)
Chart: This ETN has been smashed in price due to declines in its components. AMU Stock Chart Over the past year, the decline started last February when the price was over $21.5 per share.
ETN Performance Numbers: Through my date of purchase, the total return of this security YTD was -13.55% and the three year average annual -15.38%. Over five years, the total annual average return was -2.7%.
UBS ETRACS Alerian MLP Index ETN (AMU) Total Returns
To Be an MLP or Not to Be, That Is the Question - Bloomberg Gadfly
Components of Alerian MLP Index, As of 11/27/17:
Largest Weightings Per Preceding Snapshot:
10.27% MMP-Magellan Midstream Partners L.P
Magellan Midstream Partners Distributions
10.11% EPD-Enterprise Products Partners L.P.
Distribution Payments | Enterprise Products
9.57% ETP-Energy Transfer Partners L.P.
EnergyTransfer.com-Distribution History
7.47% MPLX-MPLX L.P.
MPLX - Distributions
6.6% WPZ-Williams Partners L.P.
Williams Partners L.P. Cash Distribution History
5.75% PAA-Plains All American Pipeline L.P.
Quarterly Distributions
4.75% BPL-Buckeye Partners L.P.
Distribution History
Distributions: The annual distributions have trended down since 2014 due to dividend cuts in some components.
UBS Declares Quarterly Coupon Payments on Exchange Traded Notes: AMU and AMUB
AMU | ETRACS Alerian MLP Index ETN | UBS ETRACS
Last Discussed: Stocks, Bonds & Politics: Item #4. Bought Back 50 AMU at $17.58 (7/5/17 Post)
Last Sell: Item # 4 A. Sold 209+ AMU Shares at $21.27 (profit snapshot= $267.76)
B. Sold 50 MDRX at $14.18 (IB Trading Account: $1 Commission):
I am trading small lots of MDRX for small profits.
Quote: Allscripts Healthcare Solutions Inc.
Trade Snapshot:
Profit Snapshot: +$69.48
Stocks, Bonds & Politics: Item # 3,B, Bought 50 MDRX at $12.75 (11/13/17 Post)
As previously explained, my goal is to harvest anywhere from $15K to $25K in short term net trading profits every year as a supplement to my dividend and interest income.
I have a YF "consider to trade" portfolio of about 200 stocks that I periodically examine throughout the trading day. MDRX is on that list. If I see any meaningful downside action with no news, and the price has fallen back into my target range, I will consider buying an odd lot as a trade.
I noted in the preceding linked post that MDRX had declined by almost 6% on my day of purchase. My consider to buy price at the moment is less than $13. I could adjust that number up or down based on future developments.
My prior trade was to sell 50 at $14.32: Item # 2 Sold 50 MDRX at $14.32 (10/16/17 Post)
MDRX has been going nowhere for about five years now: Allscripts Healthcare Solutions Inc. Interactive Chart So until I see consistency in earnings growth, I see no reason to hold the stock longer term.
My first trade was a 50 share lot bought at $8.45: Stocks, Bonds & Politics: BUY of 50 MDRX (2/3/2009 Post) that was sold at $11.82 after a brief holding period in 2009.
3. Precious Metal Bullion ETFs-PPLT:
SEK Priced Ordinary Shares: Nordea Bank AB (Sweden: Stockholm)
1 ADR = 1 Ordinary Share
SEK / USD Currency Chart Swedish Krona to US Dollar Rates
There was a slight pop in the share price last Friday. I did not see anything specific to cause that price gain unless job cuts are viewed as a positive: Nordea Bank Starts Job Cuts in Finland Targeting 500 Bankers-Bloomberg
Closing Price 12/8/2017: NRBAY $11.80 +$0.43 +3.74% : NORDEA BANK AB
Nordea is the largest bank financial operating in the Nordic and Baltic Sea regions with approximately 650 branch offices and total assets of €615B.
Key Figures: 2014-2016
Fact sheet | nordea.com
I discussed my rationale for this purchase in this comment made one day after this purchase.
Last Trade: I sold 100 shares on the annual ex dividend date earlier this year. Item # 2.A. (profit snapshot= $72.17). The USD dividend amount per share was $.69+.
Dividends: Like many European companies, Nordea pays an annual dividend. Over the past several years, the ex dividend and payment dates were in March. Dividend | nordea.com
See 2017 Notice from the Depository Trust Company.pdf:
A failure to make a relief at source claim will result in a 30% withholding rate applicable to citizens from non-treaty countries:
Virtually all nations have a tax treaties with one another.
Third Quarter Report: Interim Management Statement Third Quarter 2017.pdf
Credit Ratings:
Nordea Sets Record Low Rates on its Riskiest Bank Bonds - Bloomberg
Other Blog Discussions:
Item # 2 Bought Back 100 NRBAY at $11.56 (12/24/14 Post)- Sold on 5/20/15: Update On Portfolio Positioning And Management - South Gent | Seeking Alpha (profit snapshot=$145.07)
Item # 6 Sold 100 NRBAY at $11.265 (2/6/13 Post)(profit snapshot=$175.06)-Item # 2 BOUGHT 100 of the ADR NRBAY at $9.36 (10/10/12 Post)
Trading Profits 2015-2017 = $392.3 (plus annual dividend)
2. Small Ball:
A. Added 10 AMU at $15.98-Used Commission Free Trade:
This purchase was made on the ex dividend date when this ETN declined by more than the value of the distribution.
This purchase brings me up to 71 shares in this account, with all market purchases being made using commission free trades. The first purchase was a 50 share lot bought at $17.75 (10/18/17) and the second was a 10 share purchase $16.73+ last month before the ex dividend date. I just received the quarterly distribution on 60 shares that was used to buy 1.078 shares at a TC of $16.69. My average cost per share is $17.34.
Closing Price Last Friday: AMU $16.63 +$0.02 0.12%: ETRACS Alerian MLP Index ETN
Profile: AMU is an Exchange Traded Senior Note issued by UBS that tracks before costs the Alerian MLP Index. AMU | ETRACS Alerian MLP Index ETN (click "key considerations" for sponsor's summary of risks)
The Alerian MLP Index consists of MLPs involved in various aspects of the energy business, including pipelines, production, storage, gathering and processing.
I generally keep my exposure to ETNs limited, since that form of ownership exposes me to the issuer's credit risk, in addition to the numerous risks associated with the index being tracked by the ETN as well as other risks relating to this kind of product. "Exchange-Traded Notes Avoid Unpleasant Surprises- FINRA; NYSE Publication: "What You Should Know about Exchange Traded Notes.pdf.
As discussed previously, the energy infrastructure MLPs generally have a small or no direct exposure to energy prices. However, those companies have high fixed costs and their cash flow is dependent on the volume of product that needs to be transported, stored or processed. A decline in energy prices can negatively impact production from several fields and consequently result in lower toll collections as fixed costs, including maintenance expenditures and debt servicing costs, continue going up.
The "tax reform" bill making its way through Congress does have a provision limiting the deductibility of interest and other matters regarding the taxation of distributions. I am not going to focus on these issues until a bill is signed into law. Senate Tax Bill Sets A Trapdoor For MLPs - Bloomberg; GOP Tax Plan Is a Win for Big Business | Fortune
Closing Price Day of Purchase (11/28/17): AMU $16.01 -$0.07 -0.44%: ETRACS Alerian MLP Index ETN (price adjusted for the $.2999 per share distribution; prior close at $16.38-Historical Prices)
Chart: This ETN has been smashed in price due to declines in its components. AMU Stock Chart Over the past year, the decline started last February when the price was over $21.5 per share.
ETN Performance Numbers: Through my date of purchase, the total return of this security YTD was -13.55% and the three year average annual -15.38%. Over five years, the total annual average return was -2.7%.
UBS ETRACS Alerian MLP Index ETN (AMU) Total Returns
To Be an MLP or Not to Be, That Is the Question - Bloomberg Gadfly
Components of Alerian MLP Index, As of 11/27/17:
Largest Weightings Per Preceding Snapshot:
10.27% MMP-Magellan Midstream Partners L.P
Magellan Midstream Partners Distributions
10.11% EPD-Enterprise Products Partners L.P.
Distribution Payments | Enterprise Products
9.57% ETP-Energy Transfer Partners L.P.
EnergyTransfer.com-Distribution History
7.47% MPLX-MPLX L.P.
MPLX - Distributions
6.6% WPZ-Williams Partners L.P.
Williams Partners L.P. Cash Distribution History
5.75% PAA-Plains All American Pipeline L.P.
Quarterly Distributions
4.75% BPL-Buckeye Partners L.P.
Distribution History
Distributions: The annual distributions have trended down since 2014 due to dividend cuts in some components.
UBS Declares Quarterly Coupon Payments on Exchange Traded Notes: AMU and AMUB
AMU | ETRACS Alerian MLP Index ETN | UBS ETRACS
Last Discussed: Stocks, Bonds & Politics: Item #4. Bought Back 50 AMU at $17.58 (7/5/17 Post)
Last Sell: Item # 4 A. Sold 209+ AMU Shares at $21.27 (profit snapshot= $267.76)
B. Sold 50 MDRX at $14.18 (IB Trading Account: $1 Commission):
I am trading small lots of MDRX for small profits.
Quote: Allscripts Healthcare Solutions Inc.
Trade Snapshot:
Profit Snapshot: +$69.48
Stocks, Bonds & Politics: Item # 3,B, Bought 50 MDRX at $12.75 (11/13/17 Post)
As previously explained, my goal is to harvest anywhere from $15K to $25K in short term net trading profits every year as a supplement to my dividend and interest income.
I have a YF "consider to trade" portfolio of about 200 stocks that I periodically examine throughout the trading day. MDRX is on that list. If I see any meaningful downside action with no news, and the price has fallen back into my target range, I will consider buying an odd lot as a trade.
I noted in the preceding linked post that MDRX had declined by almost 6% on my day of purchase. My consider to buy price at the moment is less than $13. I could adjust that number up or down based on future developments.
My prior trade was to sell 50 at $14.32: Item # 2 Sold 50 MDRX at $14.32 (10/16/17 Post)
MDRX has been going nowhere for about five years now: Allscripts Healthcare Solutions Inc. Interactive Chart So until I see consistency in earnings growth, I see no reason to hold the stock longer term.
My first trade was a 50 share lot bought at $8.45: Stocks, Bonds & Politics: BUY of 50 MDRX (2/3/2009 Post) that was sold at $11.82 after a brief holding period in 2009.
 |
| +$152.48 |
A. Sold 10 Shares PPLT at $91.57:
Closing Price Day of Trade (11/28/17): PPLT $90.51 +$0.17 +0.19%: ETFS Physical Platinum ETF
Profit Snapshot: $35.27
Item # 8.B. Bought 10 PPLT at $87.63
I do not own any platinum bullion.
An Update On The Outlook For Platinum Supply-Seeking Alpha
Last Sold at $92.18: Item # 5
This trade concludes my third 10 share this year. The other two netted a total realized gain of $77.84. Perhaps, I just need something to do with my time.
Total 2017 = $113.11 (3 ten share trades)
Total 2016 = $175.67 (2 ten share trades)
2016 Snapshots:
2017 Snapshots (other two ten lot trades):
Without trading them, I would not be going anywhere with these PM ETFs, so a little profit is simply better than none at all.
In making this exit, I was influenced by the material presented in this SA article: Platinum: Get Out! I am more concerned personally with supply/demand than the technical picture. Buying falling knives is what I frequently do. I am thinking about buying 10 shares at between $80 to $83, but have not yet made a decision.
4. Short Term Bond/CD Ladder Basket Strategy:
I am filling in gaps in this basket mostly between June 2018 through November 2018.
A. Bough 1 Merchant's Bank of Indiana 1.4% CD Maturing on 6/8/18:
This bank has a five star rating from Bankrate: Merchants Bank of Indiana Reviews and Ratings - Bankrate.com
B. Bought 1 Treasury 1% Coupon Maturing on 9/15/2018:
YTM = 1.564+%
Current Yield = 1.005%
I now own 2 bonds.
C. Bought 1 Treasury .875% Coupon Maturing on 7/15/18:
YTM = 1.436%
Current Yield: .878%
D. Bought 1 Goldman Sachs Bank 1.45% CD Maturing on 8/29/18 (9 Month CD):
The GS Bank has a five star rating from Bankrate based on data as of 6/30/17: Goldman Sachs Bank USA Reviews and Ratings - Bankrate.com
Sourced: FFIEC Central Data Repository's Public Data Distribution
E. Bought 1 Goldman Sachs 1.4% CD Maturing on 5/29/18 (6 month CD):
F. Bought 1 Treasury 1.5% Coupon Maturing on 8/31/18:YTM 1.525+%
G. Bought 1 Treasury 1.25% Coupon Maturing on 11/15/18: YTM= 1.591+%
5. Equity REIT Common and Preferred Stock Basket Strategy:
A. Sold 50 DEA at $21.59-Used Commission Free Trades Round-Trip:
Profit Snapshot: +$97.85
Stocks, Bonds & Politics: Item # 3.A. Bought 50 DEA $19.64
The shares popped last Friday based on an announcement that DEA would be added to S & P's Small Cap 600 Index. Easterly Government Properties and Cutera Set to Join S&P SmallCap 600
Closing Price 12/8/17: DEA $21.60 +$0.61 +2.91% : Easterly Government Properties
I will just wait to buy back at a lower price. I did consider the buy at $19.64 to be that great of a price.
I have had some losers in my REIT basket strategy, with Dream Office Real Estate Investment Trust (Toronto) being the largest. My realized net gain now stands at +$17,364.89 since the start date in September 2013:
Realized losses are emphasized by red coloring: Stocks, Bonds & Politics: Gateway Post: Equity REIT Common and Preferred Stock Basket Strategy Gains over $200 are highlighted in green. When harvesting a large number of gains generated by small lot positions that are less than $200, it is important to avoid a loss like the one suffered in Dream Office which was -$1,641.3.
While Dream Office was my worst trade in this basket, my best trade in 2017 was to sell OHI shares at over $37 rather than riding the price down to $28. Along with other sales at over $32, I consequently have a realized OHI gain of +$1,346.79 and a low average cost per share for my remaining small odd lot position rather than an unrealized loss which would exist by holding the shares previously sold. (See Item 1.B. Stocks, Bonds & Politics: OHI) But then, the total OHI realized gain is lower than the realized loss from Dream Office. One bad decision can offset several good ones which is unfortunately true in matters outside of investing too.
Overall, I am satisfied with the income generation and profits generated by this basket, which is ultimately the purpose of this kind of strategy which is based on the premise that bad decisions will occur no matter how much an investor follows the investment process to avoid error creep.
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.
YTM = 1.564+%
Current Yield = 1.005%
C. Bought 1 Treasury .875% Coupon Maturing on 7/15/18:
YTM = 1.436%
Current Yield: .878%
D. Bought 1 Goldman Sachs Bank 1.45% CD Maturing on 8/29/18 (9 Month CD):
Sourced: FFIEC Central Data Repository's Public Data Distribution
E. Bought 1 Goldman Sachs 1.4% CD Maturing on 5/29/18 (6 month CD):
G. Bought 1 Treasury 1.25% Coupon Maturing on 11/15/18: YTM= 1.591+%
5. Equity REIT Common and Preferred Stock Basket Strategy:
A. Sold 50 DEA at $21.59-Used Commission Free Trades Round-Trip:
Profit Snapshot: +$97.85
Stocks, Bonds & Politics: Item # 3.A. Bought 50 DEA $19.64
The shares popped last Friday based on an announcement that DEA would be added to S & P's Small Cap 600 Index. Easterly Government Properties and Cutera Set to Join S&P SmallCap 600
Closing Price 12/8/17: DEA $21.60 +$0.61 +2.91% : Easterly Government Properties
I will just wait to buy back at a lower price. I did consider the buy at $19.64 to be that great of a price.
I have had some losers in my REIT basket strategy, with Dream Office Real Estate Investment Trust (Toronto) being the largest. My realized net gain now stands at +$17,364.89 since the start date in September 2013:
Realized losses are emphasized by red coloring: Stocks, Bonds & Politics: Gateway Post: Equity REIT Common and Preferred Stock Basket Strategy Gains over $200 are highlighted in green. When harvesting a large number of gains generated by small lot positions that are less than $200, it is important to avoid a loss like the one suffered in Dream Office which was -$1,641.3.
While Dream Office was my worst trade in this basket, my best trade in 2017 was to sell OHI shares at over $37 rather than riding the price down to $28. Along with other sales at over $32, I consequently have a realized OHI gain of +$1,346.79 and a low average cost per share for my remaining small odd lot position rather than an unrealized loss which would exist by holding the shares previously sold. (See Item 1.B. Stocks, Bonds & Politics: OHI) But then, the total OHI realized gain is lower than the realized loss from Dream Office. One bad decision can offset several good ones which is unfortunately true in matters outside of investing too.
Overall, I am satisfied with the income generation and profits generated by this basket, which is ultimately the purpose of this kind of strategy which is based on the premise that bad decisions will occur no matter how much an investor follows the investment process to avoid error creep.
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.
If the Democrat Jones wins today in Alabama, I wonder what the reaction will be thereafter to the 100% odds given to the GOP's tax legislation. I am assuming that Jones would vote no along with every other Democrat. He might as well since he will be a one term senator.
ReplyDeleteThere is still a narrow path to approval in the Senate which would become narrower with the loss of a single GOP vote. The Stock Jocks are still assigning 100% odds to passage.
In a WP article, several senators mentioned that there was movement to a 21% top corporate rate, which would not have any impact on the market's current enthusiasm IMO if that ends up being the rate rather than 20%.
If Moore loses today, the republicans may want to accelerate their effort.
With Senator Corker remaining a no vote based on his deficit concerns, and assuming Collins bails since she did not get what she demanded in the final bill and Jones wins tonight, the GOP loses in the Senate. The GOP would need to keep Collins on board if Jones wins and has to be sworn in as Alabama's senator before the final senate vote.
The Democrat Doug Jones beat Roy Moore. He will serve until 2020 when he will have to defend his seat. The republicans now have a one vote margin in the Senate once Jones is sworn into office. Since the republicans control the state machinery in Alabama, that may not happen until the first week in January.
DeleteThe GOP needs to step on the gas to pass tax reform. The republicans can lose Senators Collins and Corker with Pence casting the tie breaking vote, provided the vote happens before Jones has his vote. Then it would come down to Collins who is not a reliable yes vote in my opinion. She is more of a centrist Democrat than a republican.
I did note that the stock futures ticked down after the networks declared Jones to be the winner. I lived in Huntsville Alabama for several years (Madison County) which is generally a reliable county for the GOP but a significant number of republicans there are more moderate than those that live in rural counties. Trump carried Madison County by 55.9% of the vote. Moore lost that county to Jones who received 56.9% of the vote.
http://www.cnn.com/election/2017/results/alabama-senate?q=2017embed
The GOP is now in danger of losing Corker's senate seat in Tennessee with former two term governor and Mayor of Nashville Phil Bredesen, a formidable and rich centrist Democrat electing to run.
https://www.youtube.com/watch?v=t_gI8odWGGI
COTY: One of my recent small ball nibbles was this beauty products and skin care company.
ReplyDeleteCoty Inc. (COTY)
$19 +0.38 (+2.014%)
As of 11:41AM EST
The shares bounced yesterday, closing up $.71 per share.
The catalyst is a Citigroup upgrade to buy with a new price target of $21 per share:
https://seekingalpha.com/news/3317693-coty-jumps-citi-upgrade
I own just 20 shares bought at a total cost of $16.86 late last month. I did receive the quarterly dividend for that odd lot.
Item # 1.B.
https://tennesseeindependent.blogspot.com/2017/11/observations-and-sample-of-recent_30.html
The Fed raised the FF rate by .25%. The vote was 7 to 2 with Kashkari and Evans voting against an increase given what they perceive as low inflation numbers.
ReplyDeletehttps://www.federalreserve.gov/newsevents/pressreleases/monetary20171213a.htm
A majority of members are still forecasting a .75% increase in the FF rate next year. 10 out of 14 see the mid-point in the FF rate to be 2.125% or higher by 2018 year end. (the range would be 2% to 2.25%, up from the current range of 1.25% to 1.50%)
https://www.federalreserve.gov/monetarypolicy/fomcprojtabl20171213.htm
Based on the worldview of the Bond Bookies, who are currently taking the 10 year treasury down in yield, a .75% increase in the FF rate in 2018 could invert the two-ten year yield curve.
U.S. 10 Year Treasury Note 2.367% -0.041%
Last Updated: Dec 13, 2017 at 2:19 p.m. EST
https://www.marketwatch.com/investing/bond/tmubmusd10y?countrycode=bx
Through the November 2018 meeting, the Bond Ghouls are forecasting at the moment a 90.2% chance of one .25% increase and a 58.7% probability for two. The odds of three stand at 22.14%.
I would put the odds of one .25% increase at 100% and the probability of 2 at 80% assuming no Black Swan type of event or recession. I would place the odds of three at about 5%-10%. For planning purposes, which involves clustering short term bond and CD maturities, that would give me one increase in June and another in December 2018.
I can pick up now about 2% for investment grade bonds maturing in 12-14 months.
An example was a 2% SU Kroger bond maturing on 1/15/19 bought today at a TC of 100.
http://finra-markets.morningstar.com/BondCenter/BondDetail.jsp?ticker=C645889&symbol=KR4326493
I am continuing to pare my intermediate term bond ladder, moving the proceeds into 2019 bond purchases. I am going with my TN municipal bonds for longer term bond exposure.
I have published a new post:
ReplyDeletehttps://tennesseeindependent.blogspot.com/2017/12/observations-and-sample-of-recent_14.html