BNS, CIBR, CSX, CVBF, EMP, ENB, ESML, FDN, FDUS, FIVG, HIW, INTF, VSGX, VEA,

Economy: 

The FED may take a baby step next month in nudging down its $120B per month in asset purchases. Fed says it could begin 'gradual tapering process' by mid-November The Fed announced that it "could" start by reducing the monthly amount to $105B. The Bond Ghouls responded to that meaningless gesture by taking interest rates down notwithstanding the hot inflation report.  

On a non-seasonally adjusted basis, CPI rose 5.4% in September Y-O-Y. Consumer Price Index Summary The consensus estimate was for a 5.3% Y-O-Y increase. The CPI index rose .4% from August to September which was also above the .3% consensus estimate. Core inflation was up 4% Y-O-Y:

Latest Cost-of-Living Social Security Benefit Adjustment- +5.9% starting in December 2021 

JPMorgan’s Dimon says supply-chain hiccups will soon ease, points to extraordinary consumer demand

Global minimum corporate tax rate deal reached: OECD | Reuters (15% minimum rate, a good policy in IMO)

Global minimum tax will be included in reconciliation bill - The Washington Post

The Labor Shortage Is Getting Worse. A Return to ‘Normal’ Looks Questionable. | Barron's Many were expected a mass return to the job market by those receiving supplemental unemployment payments that expired in early September. This has not happened yet. The labor force is still down 4.9M since the pandemic started early last year. The issue is the upward pressure on wages given the labor shortage and its longer term impact on inflation. 

Trump tears into McConnell over debt ceiling deal with Democrats The deal was to allow a vote on increasing the debt limit.  The Republican senators wanted the U.S. default on its debt by continuing to filibuster a vote on raising the debt limit. McConnell gets GOP wake-up call | TheHill

The following chart illustrates a fundamental problem. Starting in 1969 through 2013, employee compensation as a percentage of GDP was declining: 

Annual through 2020

Compensation of Employees: Wages and Salary Accruals/Gross Domestic Product-St. Louis Fed

A new look at the declining labor share of income in the United States-McKinsey Global Institute (note the chart at page 3 showing the decline in labor's share of income)

When I say that the FED will do nothing to restrain inflation, I am referring to monetary policy actions that would actually have an impact. Cutting asset purchases and raising the FF rate slightly next year, or even to 3% which the FED is not going to do anyway, will have no impact on inflationary pressures. I discussed in a recent post what the FED had to do in the late 1970s and early 1980s to kill problematic inflation that had become embedded in the economy. 9/24/21 Post Inflation will just have to fix itself. 

++++

Markets and Market Commentary: 

JPMorgan CEO Jamie Dimon says 'bitcoin is worthless' amid crypto bull run - MarketWatch Bitcoin, like precious metals, has no ascertainable intrinsic value, but is nonetheless worth whatever someone is willing to pay for it. I will stick with gold which humans have treated as having value for well over 2,000 years. I view gold primarily as an alternative to fiat currencies. {scroll to "Gold's Price: Is There a Fair Value" (4/23/2014 Post)} 

Jeremy Grantham is right that there's a bubble, this strategist says. Why right now is a good buying opportunity for stocks. - MarketWatch

++++

Close on 10/14: GNL $16.44  +$0.14 +0.86%-Global Net Lease, Inc. 

I discussed this externally managed net lease REIT in my last post.  GNL went ex dividend for its $.40 per share quarterly distribution on 10/8. I bought a 1,000 share lot shortly before that date. 

I mentioned there that I would reinvest the dividend which was paid today: 

Fidelity will actually buy the shares before receiving the dividend payment.  

I may manage risk in part by profitably selling the GNL shares bought with dividends, since I have no interest in the compounding effect given my age, financial condition, and investment objectives. 

Compared to most other net lease REITs, GNL is substantially undervalued using Price to AFFO and dividend yield. This is not to say that the other higher multiple net lease REITs are fairly valued, undervalued or overvalued. This is just a comparative analysis.

As an externally managed REIT, GNL does IMO deserve IMO a comparative price discount to internally managed net lease REITs. The question is how much. 

I was looking at a new internally net lease REIT last night:  

NTST $24.29 +$0.11 +0.45%: NETSTREIT Corp. 

NTST pays a quarterly dividend of $.20 per share compared to GNL's $.40. 

NTST reported 2nd quarter AFFO per share of $.20 per share and reaffirmed 2020 AFFO per share guidance at $.95 to $.99. NETSTREIT Reports Second Quarter 2021 Financial and Operating Results Taking the midpoint of $.97, the Price/AFFO at yesterday's close of $24.29 is 25.04. I decided to avoid that one until the price sinks below $15 or so. 

GNL reported 2nd quarter AFFO per share of $.44. SEC Filed Earnings Press Release  Assuming the same number in 3 more quarters, which is a fair assumption IMO given the stability of the revenues, the annual AFFO per share number would be $1.76 and the Price/AFFO would be 9.34 using yesterday's closing price. 

On a 1 to 5 scale, YF has the average GNL broker recommendation at 2.4 and at 1.6 for NTST. KeyBank downgraded GNL to sector weight on 7/20/21 while maintaining NTST  at overweight. 

Global Net Lease Announces $40 Million Walmart Acquisition, $381 Million of Acquisitions Year-To-Date (" Including both acquisitions closed in October, year to date, GNL has closed on nine properties for a contract purchase price of $381 million at a going-in capitalization rate  of 8.73%, a weighted-average capitalization rate of 9.74%, and a weighted average remaining lease term of 16.9 years at closing." (footnotes omitted)

Fitch Assigns Global Net Lease First-Time 'BB+' IDR; Outlook Stable (12/7/20)

The current GNL price is close to its tangible book value per share according to Reuters. That creates a problem IMO given the depressed stock price. The end result is that financing growth through common stock offerings is not a desirable option for existing shareholders. GNL does raise cash through its ATM stock sales and by selling relatively high cost equity preferred stocks. 

+++++

Republicans Seeking To Discredit Wisconsin Elections Off To A Bumbling Start - YouTube Republicans are attempting to discredit the Wisconsin presidential results by running yet another "audit". What's The Status Of GOP-Backed Election Investigations In Wisconsin? | Wisconsin Public Radio (9/22/21) After previous audits, a partial state recount, and numerous lawsuits filed by Trumpsters, only 13 allegations of voter fraud were found in Wisconsin. That, along with anonymously generated conspiracy theories circulating through the internet, was enough for Republican dominated state legislature to launch yet another audit challenging the official count that will cost Wisconsin taxpayers almost $700,000. Elections Commission Report: 13 Instances Of Possible Voter Fraud Referred To Prosecutors From November Election | Wisconsin Public Radio 

Trump’s never-ending parade of election falsehoods - The Washington Post

Trump Explored Conspiracy About Chinese Thermostats Changing 2020 Votes Doofus Don is neither stable nor a genius. He would have been better off financially by investing his Dad's money in the S & P 500. The New York Times revealed how Fred Trump funneled $413 million to his son Donald -The Washington Post (noting several polls where about 50% of Americans believed that Trump was not made wealthy by his dad) Trump Engaged in 'Outright Fraud' to Avoid Taxes-Business Insider 50% is a good estimate of U.S. voters who have been 100% immunized against facts. Donald Trump’s Business Failures Were Very Real | The New Yorker; Trump Has Lost More Than $315 Million on His Golf Courses in 20 Years-Business Insider; Trump's Scottish golf courses post another year of losses | Donald Trump | The Guardian

Steve Scalise (R-LA), the Republican House Minority Whip, Refuses to Deny Election Was Stolen From Trump

Judge dismisses lawsuit seeking a deep inspection of Georgia ballots; Georgia investigators report no counterfeit ballots found in Fulton County November election Facts do not matter in Trump's America, never will have any significance, and consequently can not contradict the reality creations promulgated by Trump, his minions and apparatchiks in the media. 

Sidney Powell Claims All Votes Go to a Secret Server So People Can Manipulate Them And in TrumpWorld, that one server is infected with the ghost of Hugo Chavez who wanted Biden to defeat Psychopath Don. 

For both state and federal elections, Democracy will be on the ballot for many years to come. 

As I have noted previously, I have become a one issue voter. The issue is American Democracy.   

I read an opinion column written by the republican Max Boot who declared that he too has become a one issue voter. Opinion | I’m no Democrat — but I’m voting exclusively for Democrats to save our democracy - The Washington Post (Boot: "I’m a single-issue voter. My issue is the fate of democracy in the United States. Simply put, I have no faith that we will remain a democracy if Republicans win power. Thus, although I’m not a Democrat, I will continue to vote exclusively for Democrats . . .until the GOP ceases to pose an existential threat to our freedom.") 

Trump and his party are IMO a clear and present danger to American Democracy and the institutions necessary for the proper functioning of a Democracy.  

Foreign Governments and MAGA Barflies Couldn’t Prop Up Trump’s D.C. Hotel | Vanity Fair; Trump lost millions operating D.C. hotel : NPR

Texas Gov. Greg Abbott (R) bans any COVID-19 vaccine mandates by private companies | The Texas Tribune Abbott already has a lot of blood on his hands IMO and apparently he wants more.  

Lindsey Graham booed after asking Republicans consider COVID vaccine In Trump's America, Graham lied when he correctly stated that most hospitalizations from Covid were unvaccinated people. Everything is upside down in TrumpWorld. 

Black Children Were Jailed for a Crime That Doesn’t Exist. Almost Nothing Happened to the Adults in Charge. — ProPublica This occurred in Rutherford County Tennessee, near where I live. The Judge responsible was the Republican Donna Scott Davenport. 

Voter guide: Meet your Rutherford County candidates

Opinion | The 2024 elections are shaping up to put Donald Trump back in the White House - The Washington Post Written by the Republican Michael Gerson. The 2020 Presidential election proves that at least 74+M voters want an obvious psychopath, and the most powerful enemy of America's Democracy, to serve another 4 years as President. As Trump hints at 2024 comeback, democracy advocates fear a ‘worst-case scenario’ for the country - The Washington Post; Psychoanalyst: Trump Is “Delusional Psychopath” Who Needs To Be Removed Immediately-YouTube I do not anticipate that number will shrink in 2024.  

Donald Trump Des Moines, Iowa Rally Speech Transcript October 9, 2021 - Rev

+++

1. Small Ball: 

Baseball analogy-Small ball (baseball)-Wikipedia  

The underlying rationale for the small ball trading strategy is risk mitigation in what I view as a dicey stock market whose parabolic rise has been fueled by (1) unprecedented money creation; (2) central bank suppression of interest rates far below the inflation rate through extraordinarily abnormal monetary policies continued now for almost 14 years; (3) extreme levels of U.S. government deficit spending, and (4) spending rapidly increasing amounts of borrowed money.  

Small Ball Rules:

(1) Each purchase has to be at the lowest price in the chain; or has to lower my average cost per share; 

(2) Purchases are made in small lots, using commission-free trades;

(3) On price pops, I will consider selling my highest cost shares at a profit, no matter how small;

(4) Some positions will be eliminated altogether on price pops when the goal is achieved; 

(5) Shares purchased with dividends may be sold when it is profitable to do so and the share price is outside my consider to buy range.  

The most important objective is to reduce risk through a controlled and disciplined trading strategy that realizes gains, particularly by selling the highest cost lots that reduce my average cost per share, increasing my dividend yield.  

The corollary is to buy the dips, particularly during extreme volatility events that would be associated with major declines in stocks.   

Another aspect is selling fractional shares bought with dividends in order to harvest the original dividend amount plus a small profit on the shares. I am doing that regularly now, having turned off the dividend reinvestment option in virtually all stocks that I own. 

The primary known threats to the stock market are potentially problematic inflation, high valuations and a renewed surge in the pandemic that materially disrupts the economy. Those threats are placed in order of likelihood based on my opinion and what is known now. 

The primary erroneous assumption is that the extraordinary stimulus measures outlined above can continue indefinitely or that the economy will experience robust growth when they have to be withdrawn.  

A. Bought 10 CVBF at $19.42; 5 at $19: 

Quote: CVB Financial Corp. 

Closing Price 10/14: CVBF $20.00 0+$.25 +1.27% 

"CVB Financial Corp. (“CVBF”) is the holding company for Citizens Business Bank. CVBF is one of the 10 largest bank holding companies headquartered in California with over $15 billion in total assets. Citizens Business Bank is consistently recognized as one of the top performing banks in the nation and offers a wide array of banking, lending and investing services through 58 banking centers and 3 trust office locations serving the Inland Empire, Los  Angeles County, Orange County, San Diego County, Ventura County, Santa Barbara County, and the Central Valley area of California."

SEC Filings  

Investment Category: Regional Bank Basket Strategy

Last Round-Trip: Item # 5 Sold 50 CVBF at $9.65 (1/12/2010 Post)(profit = $65.6)-Item # 6 Bought 50 CVBF at $7.94 (12/4/2009 Post) 

I had forgotten about this bank. In search for current income alternatives, I started to revisit regional bank stocks that had been previously sold and forgotten. 

AC per share this account = $19.38 (15 shares)

Dividend: Quarterly at $.18 per share ($.72 annually), last raised from $.14 per share in 2019. 

CVBF Dividend History 

Yield at AC: 3.72%

Last Ex Dividend: 10/5/21 (owned all as of)

5 Year Financial Data: 

Charge off, NPL and efficiency ratios are excellent. Capital ratios are good IMO. 

Sourced: 2020 10-K

Last Earnings Report (Q/E 6/30/21): SEC Filed Press Release 

Income: $51.2M

E.P.S. $.38, up from $.31 in the 2020 2nd quarter

NIM = 3.06%, down from 3.7% in the 2020 second quarter (a major problem but fairly common among regional banks)

Efficiency Ratio = 40.05% (excellent)

NPA Ratio = .05% (excellent)

Charge off ratio = Slight recovery

Coverage Ratio = 818.58% (prefer over 100% when initial purchase is made)

ROA = 1.35% (slightly above average)

ROTE = 15.6% (good)

Tangible Book Value per share = $10.02

Total Risk Based Capital Ratio = 15.9%

B. Added 2 CSX at $30.5 and 1 at $29.66; and Sold 1 $33.09: 

Bought 3: 

Sold 1: 

Extreme Small Ball on Steroids.  

Quote:  CSX Corp.

Closing Price 10/14: CSX $33.43 +$0.85 +2.61% 

Last Discussed: Item # 4.D. Restarted CSX-Bought 2 at $31.74; 1 at $30.67 (7/31/21 Post) I discussed the last earnings report in that post and have nothing further to add here. SEC Filed Earnings Press Release for the Q/E 6/30/21; 10-Q for the Q/E 6/30/21; SEC Filed Supplementals for Q/E 6/30/21

CSX SEC Filings

CSX Analyst Estimates | MarketWatch (as of 10/11/21, the consensus E.P.S. estimate was $1.49 this year; $1.7 in 2022 and $1.88 in 2023) I would place a fair value range between $25.5 to $28.9, which is 15 to 17 x. the 2022 consensus estimate of $1.7. 

Website: CSX rail, intermodal and rail-to-truck transload services - CSX.com

CSX Profile | Reuters

CSX Key Metrics | Reuters

Dividend: Quarterly at $.09 per share, last raised from $.06 effective for the 2020 first quarter payment. 

CSX Corporation - Stock Information - Dividend History

AC per share: $30.61 (5 shares)

Snapshot Intraday on 10/14/21

Yield at AC = 1.18%. Viewed by me as being immaterial and providing no support for the current stock price.   

Next Ex Dividend: 11/29/21

Prior Round Trip: Item # 1 Sold  100 CSX at $30.4 (6/21/14 Post)(profit = $390.78)-Item # 5 Bought 100 CSX at $26.33 (11/12/13 Post) The stock subsequently split 3 for 1. 

Maximum Position: Until the price falls below $28, the maximum position in light of valuation and immaterial dividend yield will be 10 shares. The maximum position will then be raised to 100 shares with incremental purchases between $25 to $30.  

Purchase Restriction: Each subsequent purchase has to be at the lowest price in the chain. 

Profit Snapshot 1 Share = $1.34

C. Sold 3 of 9 FIVG in Fidelity Taxable at $38.08: 

I discussed this ETF in my last post and forgot to add this pare. Item # 2.A. Sold 5 FIVG at $38.83-Schwab Taxable 

Quote: FIVG | Defiance Next Gen Connectivity ETF Overview

The First 5G ETF - FIVG

Profit Snapshot: $25.46

New Average Cost per share: $28.74 (5 Shares)

Snapshot Intraday on 9/10/21 after pare

The AC was reduced from $29.06.

D. Added 2 HIW at $43.42: 

Quote: Highwoods Properties Inc - An Office REIT

Closing Price 10/14: HIW $46.54  +$0.56 +1.22% 

HIW SEC Filings

10-Q For the Q/E 6/30/21

2020 Annual Report

Company Website: Highwoods

Highwoods Properties Inc Profile | Reuters

Last Discussed: Item # 1.I.  Bought 5 HIW at $45.68 (9/3/21 Post)  I briefly mentioned the last earnings report in that post.  

Investment Category: Equity REIT Common and Preferred Stock Basket Strategy/Bond Substitute

Average Cost per share this account: $45.02  (7 shares) 

Dividend: Quarterly at $.50 per share 

Highwoods Declares Quarterly Dividends

Yield at AC of $45.02 = 4.44% 

Last Ex Dividend Date: 8/13/21 (owned 5 as of)

HIW Bonds: I still own 5 HIW 3.625% $1K par SU bonds maturing on 1/15/23, see previously linked post for details. 

E. Sold Remaining ENB Shares Purchased with Dividends in Fidelity Account at $40.14: 

Quotes: 

USD: Enbridge Inc. (ENB)

CAD: Enbridge Inc. (Canada: Toronto) 

Closing Price 10/14: ENB $42.53 +$0.42 +1.00% 

ENB Profile | Reuters

ENB Key Metrics | Reuters

Investment Categories: Contrarian Value/Bond Substitute  

I currently own ENB in 5 accounts.  

Profit Snapshot: +$20.93 

Average Cost Per Share this account after pare:  $30.79 (43 shares)

Snapshot as of close 9/13/51 after pare

The AC per share was reduced from $30.98. 

I currently own ENB in 3 taxable accounts and two Roth IRA accounts. 

ENB Vanguard Taxable: AC $29.13 (20 shares)

Schwab Taxable: AC $28.79 (12 shares)

Total ENB Taxable Account Position: 75 shares with an AC per share of $29.3. 

Last Buy Discussions: Item # 1.F. Added to ENB in Vanguard Taxable Account-Bought 5 at $29.51; 5 at $28.95; 5 at $27.4 (10/31/20 Post); Item # 1.C. Added 5 ENB at $30.65-Fidelity Taxable (8/15/20 Post); Item # 1.C. Added 1 ENB at $27.23; 1 at $26.21; 1 at $25.49; 1 at $24.29; 1 at $23.68  (4/18/20 Post)

Dividend: Quarterly at C$.835 (C$3.34 annually), last raised from C$.81 effective for the 2021 first quarter payment. 

Dividends and Common Shares - Enbridge Inc. 

For the USD priced shares, the dividend yield before taxes will depend on the CAD/USD conversion rates. If I assumed a constant .8 conversion rate, the current annual dividend expressed in USDs would be $2.67 per share rounded and the yield at my constant cost number of $30.79 would be about 8.68% for shares owned in this account.  

Canada will withhold a 15% tax when the dividend is paid into a U.S. citizen's taxable account, but there is no withholding when paid into a U.S. citizen's retirement account (unless your brokerage firm is not doing its job). 

Last Earnings Report (Q/E 6/30/21): Enbridge (ENB) SEC Filed Press Release 

adjusted earnings of C$1.4 billion or C$0.67 per common share, with the consensus at C$.564;

GAAP E.P.S. at C$.69; 

distributable Cash Flow (DCF) of C$2.5 billion or C$1.24 per common share, compared with C$2.4 billion or C$1.21 per common share in 2020; 

reaffirmed full year DCF of C$4.7 to C$5 per share

The line 3 replacement project "is on track to be in service in the fourth quarter and is expected to contribute approximately $200 million of incremental EBITDA in 2021, and support significant free cash flow growth in 2022 and beyond."

Line 3 Replacement Project - Enbridge Inc.

Last Sell Discussions: Item # 1.B. Sold 8 ENB at $42.36 (2/19/20 Post)(profitably sold shares bought with dividends in my Fidelity taxable account); Item # 3.B. Sold 17 ENB at $40.21 (1/18/20 Post); Item # 1.B. Sold 15 ENB at $37.61-Used Commission Free Trade (2/20/19 Post); Item # 3 Sold 50 ENB at $39.03 (12/21/17 Post); Sold 10 ENB at $40.14 (1/5/18 Post)

ENB Realized Gains to Date: $280.89

Only 1 trade netted over $100: 

2020 ENB 25 shares $136.54 

Overall, I have so far achieved my subdued goal for ENB's common stock. The primary goal is to harvest the dividend without losing money on the shares. A secondary goal is to sell my highest cost lots profitably, reducing my risk exposure and increasing my dividend yield.  

+ 

I also currently own 400 shares of an Enbridge reset equity preferred stock traded in Toronto.

As of 10/14/21 Close/Unrealized Gain = C$1,840

Last Discussed: Item # 1.A. Added to ENBPRP:CA-Bought 100 at C$17.14 (4/24/21 Post); Item # 3.A. Added to ENBPRP:CA Bought 50 at C$11.98 and 50 at C$11.76 (6/13/20 Post); Item # 2.A. Bought 50 ENBPRP at C$15.68 (11/27/19 Post); Item # 4.A. Bought 100 ENBPRP:CA at C$16.5 (3/20/19 Post) The current coupon is 4.35% paid in quarterly installments on a C$25 par value. The next reset will be in March 2024 at a 2.5% spread to the 5 year Canadian bond yield. 

Preferred Shares and Hybrid Securities - Enbridge Inc.

I have realized several gains so far in Enbridge reset equity preferred stocks: 

USD Profits: $1,809.78

ENBPRP

ENBPRP US$1,458.25 (Converted by Fidelity from CAD profit)

EBGEF (traded in USDs, U.S. Grey Market): $351.53

CAD Profits: +C$1,276

ENBPRP

+C$963

ENBPRF = +C$313

F. Eliminated FDN in Fidelity Account-Sold 2 at $244.75: 

Quote: First Trust Dow Jones Internet Index ETF Overview 

Sponsor's Website: First Trust Dow Jones Internet Index Fund (FDN)

Expense Ratio = .51%

Profit Snapshot = $160.19

Last Discussed: Item # 4.A. Started FDN-Bought 1 at $166; 1 at $163.3-Fidelity Taxable (6/7/20 Post) 

Dividends: None since 2011

Holdings: 41

Holdings Weighted at over 1% (as of 10/8): 

G. Eliminated VEA (Fidelity Account)-Sold 3 at $53.37: 

Quote: Vanguard FTSE Developed Markets ETF Overview 

Sponsor's Website: VEA-Vanguard FTSE Developed Markets ETF 

Vanguard FTSE Developed Markets ETF (VEA)-Morningstar (currently 4 stars)

Holdings: 4,043 stocks as of 8/31/21

Expense Ratio: .04%

This ETF provides a way to gain exposure to international stocks excluding emerging markets. 

Profit Snapshot: +$45.77

Top Ten Holdings as of 8/31/21: 

 Dividend: Quarterly at a variable rate

Last 4 Dividend Payments: $1.26 per share rounded

Yield at $45.77: 2.75%

H. Eliminated VSGX (Vanguard Taxable)-Sold 3 at $65.67: 

Quote: Vanguard ESG International Stock ETF Overview

ESG =  Environmental, Social, Governance Screens 

Sponsor's Website: VSGX - Vanguard ESG International Stock ETF

Expense Ratio: .15%

Stocks Owned as of 8/31/21: 5,182. 

Profit Snapshot: +$44.47 

Last Discussed: Item # 1.C. Bought 2 VSGX at $51.18; 1 at $50.2 (8/22/20 Post) 

Dividends: Quarterly at a variable rate

Last 4 Dividends: $1.21 per share rounded

Yield at 65.67 = 1.85% rounded

Vanguard ESG International Stock ETF (VSGX)-Morningstar (currently rated 4 stars)

I. Eliminated ESML in Vanguard Taxable-Sold 5 at $39.5: 

Quote: iShares ESG MSCI USA Small-Cap ETF Overview

Sponsor's Website: iShares ESG MSCI USA Small-Cap ETF

Expense Ratio: 

Profit Snapshot: $73.49

Last Discussed: Item # 1.K. Bought 5 ESML at $24.8 (8/1/2020 Post) 

Dividends: Quarterly at a variable rate

Last 4 Dividends: $.42 per share rounded 

Yield at $39.5 = 1.06%

iShares ESG Aware MSCI USA Small-Cap ETF (ESML)-Morningstar (currently rated 4 stars)

J. Eliminated CIBR in Vanguard Account-Sold 5 at $50.95:

Quote: CIBR | First Trust NASDAQ Cybersecurity ETF Overview

Sponsor's Website: First Trust Nasdaq Cybersecurity ETF (CIBR)

Expense Ratio: .6%

Profit Snapshot: +$92.87 

Last Discussed: Item # 1.F. Bought 5 CIBR in Vanguard Taxable at $32.29 (7/25/20 Post) 

First Trust NASDAQ Cybersecurity ETF (CIBR)-Morningstar (currently rated 2 stars)

Dividends: Since inception, the fund has paid only 1 dividend and that was $.033 per share. 

K. Pared FDUS Again-Sold Highest Cost 3 shares at $17.5 after ex dividend date-Schwab Taxable: 

Quote: Fidus Investment Corp. - A BDC

Closing Price 10/14: FDUS $17.55 +$0.01 +0.06% 

Website: Fidus

Management: External 

SEC Filings

10-Q for the Q/E 6/30/21 (summary of investments starts at page 6) t

Profit: +$14.93

Remaining Lot Details this Account: 

Average Cost per share after pare this account: $8.47 (30+ shares)

Dividend: Quarter at $.31 ($1.24 annually), regular dividend only. 

The last quarterly dividend, which went ex on 9/13, included a special dividend of $.04 per share and a $.06 per share "supplemental" dividend. 

FDUS Dividend History | Nasdaq

Note the special dividends and the cut in the regular dividend rate from $.39 per share to $.30 effective for the 2020 second quarter payment. The regular dividend was then raised to $.31 per share effective for the 2021 first quarter payment. 

Yield at AC of $8.47 =  14.64%  (regular dividend only)

Last Ex Dividend Date: 9/13/21 

Net Asset Value Per Share History: For an externally managed BDC, this is a favorable history.

6/30/21:     $17.57

12/31/20:   $16.81
9/30/20:    $15.94
12/31/19:    $16.85
9/30/19:     $16.47 10-Q
12/30/18:   $16.47
9/30/18:     $16.41
3/30/18      $16.28
12/31/17     $16.05
12/31/16     $15.76 
12/31/15     $15.17
12/31/14     $15.16
12/31/13     $15.35
12/21/12     $15.32

IPO at $15 June 2011

Last Earnings Report (Q/E 6/30/21): SEC Filed Press Release

NII per share = $.26, adjusted to $.42 by pretending the capital gains incentive fee will not be paid to the external manager; 

net asset value per share = $17.57; 

"For the three months ended June 30, 2021, the total net realized gain/(loss) on investments, net of income tax (provision)/benefit on realized gains, was $2.2 million"; 

"On August 2, 2021, our board of directors declared a base dividend of $0.32 per share, a supplemental dividend of $0.06 per share, and a special dividend of $0.04 per share for the third quarter." 

"estimated spillover income (or taxable income in excess of distributions) as of June 30, 2021 of $25.5 million, or $1.04 per share." 

Goal: Any total return in excess of the dividends paid. 

FDUS Realized Gains to Date (includes RI snapshots): $264.54

2021: 

 Schwab Account 23 Shares +$50.51

Fidelity Account 12 Shares +$41.21

2020: 

Fidelity Account 25 Shares +$21.36

Schwab Account 30 Shares +$5.78 

Vanguard Account 10 Shares +$2.7

2019: 

 Schwab Account 52 Shares +$32.88

2018:  

Schwab Account 50 Shares +$68.44

Roth IRA: +$41.66

Current FDUS Positions: 

Vanguard Taxable = AC at $8.01 (15 shares)

Schwab Taxable = AC at $8.47 (30+ shares, see above snapshot)

Fidelity Taxable = AC at $7.98 (20+ Shares) 

see snapshot at Item # 1.G 

Roth IRA Accounts:  7+ Shares AC at $6.75

Prior Sell Discussions Item # 1.E. Sold 7 FDUS purchased with Dividends at $16.44-Schwab Account (4/30/21 Post); Item # 1.G. Pared FDUS in Fidelity Taxable Account-Sold 10 at $15.01(3/20/21 Post); Item # 1.I. Pared FDUS in Fidelity Taxable Account-Sold 2 at $13.6 and Item # 1J. Pared FDUS in Schwab Taxable Account-Sold 13 at $14.01 (2/13/21 Post); Item # 2.O. Continued Paring FDUS -Sold Highest Cost Lots in Fidelity Taxable Account at $13.75 (11/28/20 Post); Items 1.L, 1.M; 1.N (11/30/20 Post); Item 1.D. and E. Pared FIDUS in Schwab Account-Sold 50 at $15.34 and Sold 20 FDUS (Fidelity Account) at $15.4 (2/22/20 Post); Item # 1.C. Pared FDUS-Sold 52 at $15.15 (3/6/19 Post) 

Last Buy Discussion: Item # 3.C. Bought Back FDUS in Fidelity Account Bought 20 at $13.7; 5 at $11.99; 5 at $11.5; 5 at $9, 2 at $8.56, 2 at $5.98, 1 at  $4.65 (3/28/20 Post)

Total Remaining FDUS Shares: 72+  

AC at $8.07

Yield at $8.07 = 15.37%  (regular dividend only)

This is an example of a successful small ball trading. 

L. Eliminated INTF in Fidelity Account-Sold 6 at $30.76: 

Quote: INTF | iShares Edge MSCI Multifactor Intl ETF Overview

Sponsor's Website: iShares Edge MSCI Multifactor International ETF

Expense Ratio: .30%

Profit Snapshot = $44.09 

Last Buy Discussion: Item # 1.G. Bought 5 INTF at $23.32; 5 at $22.81(7/18/20 Post)

Last Sell Discussion: Item # 3.B. Sold 10 INTF at $30.18 (8/20/21 Post) (profit snapshot = $71.22)  

Dividends: Semi-Annually at a Variable Rate

Last 3 Dividend Payments: $.90 per share rounded

Yield at $30.76 = 2.92%

M. Added to BNS-Bought 1 at $61.05; 1 at $59.68: 

Quotes: 

USD: Bank of Nova Scotia (BNS)

CAD: Bank of Nova Scotia Stock Quote (Canada: Toronto)

Closing Price 10/14: BNS $63.91 +$0.74 +1.17% 

Canadian Dollar to US Dollar Exchange Rates Chart

BNS Analyst Estimates | MarketWatch

Investor Relations

BNS-TO Profile | Reuters

BNS.TO - Bank of Nova Scotia Key Metrics | Reuters

Last Discussed: Item # 1.N. Added 1 BNS in Fidelity Taxable at $61.59 (8/6/21 Post); Item # 1.B. Started BNS - Bought 5 at $64.97 before ex dividend; 1 at $62.83 after ex dividend (7/15/21 Post) 

Dividend: Quarterly at C$.90, last raised from $.87 effective for the 2019 4th quarter payment. 

Common Share Information

USD Value Last 4 Dividend Payments: US$2.82 rounded

Average cost this account: $63.35  (9 shares)

Yield Using US$2.82 and AC per share this account = 4.45%

The dividend yield will fluctuate with the CAD/USD exchange rates USD Priced BNS  Dividend History | Nasdaq

Last Ex Dividend: 10/4/21

Last Earnings Report (Q/E 6/30/21): Bank of Nova Scotia (BNS) SEC Filed 3rd Fiscal Quarter (7/31/21) Earnings Press Release; The Bank of Nova Scotia (BNS) Q3 2021 Earnings Call Transcript | The Motley Fool

Net income = C$2.542B 

E.P.S. = C$1.99

Adjusted Net Income = C$2.56B

Adjusted E.P.S. = C$2.01 

ROE = 15% adjusted to 15.1%

Total Capital Ratio  =  15.7%  

The Canadian Banks have dividend yields over 4% and TTM P/E ratios in the low double digit range (fluctuating mostly in the 10-12 range depending on current prices and impact of the most recent earnings report). 

I added earlier this month Bank of Montreal  (BMO) in an IRA account. The  P/E  using the earnings estimate for 2022 and my $103.36 cost per share is about 10.42. I also own Royal Bank of Canada (RY) in a Roth IRA with a cost basis of $85.13 and BNS in two Roth IRA accounts. My largest position is in Toronto-Dominion Bank (TD), owned in several accounts and last discussed in Item # 2.H. (eliminated shares purchased with dividends in my Fidelity taxable account that reduced the position to 38 shares with an AC of $51.33, realized TD gains to date of $1,695.95). 

Canada will not levy a tax on dividends paid into a U.S. citizen's retirement account.  Foreign country taxes levied on dividends paid into a U.S. citizen's retirement account can not be recovered through U.S. tax credits.   

N. Bought 11 BNS at Various Prices-Schwab Taxable: 

See Item # 1.M. above. 

Average Cost at $63.19 per share 

O. Bought 10 EMP in Vanguard Taxable at $25.15: 

Quote: Entergy Mississippi LLC 4.9% First Mortgage Bonds Overview

Closing Price 10/14: EMP $25.39 -$0.08 -0.31% 

I previously thought the issuer would call this bond on 10/1/21 at its $25 par value. This did not happen. Since I still expect the issuer to call soon, I would not pay more than $25.15 which is close to break-even with the accrued and unpaid interest given the 30 day minimum notice period for an optional redemption. I have not seen any notice yet, nor any prospectus filed for a new bond whose proceeds would be used to redeem this one.  

Investment Category: Exchange Traded Baby Bonds, subcategory of Exchange Traded Bonds 

Last Buy Discussion: Item # 2.B. Bought 10 EMP at $23.76, 5 at $21.07; 10 at $20.39 (4/25/20 Post)

Last Sell Discussion: Item # 5.A. Pared EMP-Sold 5 at $26.84  (6/27/20 Post)

Security: First Mortgage Bond

Prospectus
Par Value: $25

Maturity: 10/1/66 unless called early at issuer's option

Optional Redemption:  At par value on or after 10/1/21  

Trades Flat
Last Ex Interest Date: 9/29/20

Credit Ratings:

Prior EMP Round-Trips:

Item # 4.A. Eliminated EMP-Sold 70 at $24.87 (5/1/19 Post)(profit snapshot = $207.92)-Item # 1.B. Bought 70 EMP at $21.76 (1/2/19 Post);

Item # 2.B. Sold 30 EMP at $24.44  (2/13/19 Post)(profit snapshot = $7.04)-Item # 4.A. Bought 30 EMP at $24.04-Used Commission Free Trade (5/28/18 Post)

Items 2.A and B. Sold 50 EMP at $24.97 and 30 at $24.96  (9/21/17 Post)(profit snapshots $167.52) 

Item # 2.A. Sold 50 EMP at $24.47 (7/22/17 Post) (profit snapshot = $66.98)-Item  # 2.B. Bought 50 EMP at $22.85 (5/17/17 Post)

Current EMP Position-Schwab Taxable Account: 

20 Shares AC at $21.40

 
EMP Trading Profits to Date:  $464.9

I also currently own 6 $1K par value First Mortgage bonds issued by Entergy Mississippi. 

5 of the bonds are the 3.1% First Mortgage bonds maturing on 7/1/23. Item # 3.A. Bought 3 Entergy Mississippi 3.15% First Mortgage Bonds Maturing on 7/1/23 at a TC of 99.111 (2/13/19 Post)

If the issuer does not call EMP early, there is still interest rate risk to the price resulting from a persistent rise in longer term rates, made more acute by the 2066 maturity date. Holding this bond to maturity is not an option for me. 

In a rational universe, however, one that does not exist currently, there should be a lag in price depreciation caused by a rise in longer term interest rates. 

Why? 

First, that rise would make it more unlikely that the issuer will exercise its optional redemption right. And, at some point in the uptrend in interest rates, the issuer would not be able to refinance at a lower coupon and similar or longer maturity, particularly after paying investment banks to market a new bond issue. 

Second, the current yield and yield-to-maturity is way above what similarly rated bonds yield.  

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 sale 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 my family members.