I've seen things you people wouldn't believe. Attack ships on fire off the shoulder of Orion. I watched C-beams glitter in the dark near the Tannhauser gate. I watched MTGE drop $8.73 (33%) since its last dividend run up after they reduced the dividend $0.10 (11%). All those moments will be lost in time... like tears in rain... Time to die.
I took a shorter term approach and didn’t purchase any calls until the July calls were available. My first round were the July 22.50 calls. After those went to zero (almost), I purchase some July 20 calls. Now they are gone. Fortunately I was up $50K for the year and had $30K invested. After today I will still be up $20K for the year and will be sitting on the sideline in all cash.
In my opinion, I think MTGE has the best future going forward. Their fundamentals are good and they only dropped their dividend $0.10. Their share price has dropped 33%, but with the interest spreads getting wider, their ability to make money off the spreads will grow significantly. They also have more room to increase their leverage. Gary and company know how to grow their business. It make take a while but I really see MTGE having a great run in 2014 as long as the Feds don’t screw things up any more than they have. This all depends on how the market responds to MTGE and what kind of return the market expects from them.
I wish you and IWB well. May the investment gods shine on both of you. For me, I will wait until I see an SPO I like with either MTGE or AGNC. So far their SPOs have been a sure thing operating in this crazy world investment world.
I had a horrible Dec., losing on both AGNC and APPL, then I clawed my way back to make most if it back and was in the black. Then I decided to go for AGNC and MTGE. I had done extremely well controlling the level of trades and turning then much faster. So why, I went for it, I don't k know. For cabling fine I have wondered whether this dividend exit trade would work. Anyway, I realised I was in a stinker fairly quick, bit tripled down. I could have excited at breakeven at one point and then at 26. Well, I kept the money on the table and the 10 year rise. Now, I am holding a lot if worthless calls, but I think the market gas oversold the 10 year, bonds and the book value of mreits.
My theory is the big boys wanted to see if they could grab these yields after ex dividend for an even discount and they are probably right. They will get a good deal today and then the price will rise. Then the fed will clarify what they are talking about, corporate earnings will hit. I don't think its all rosy on the economic side either. So my guess this will blow over, but I did not want to be here. I just refuse to discount and sell the shares to an unsupported figure. So, yes, lets hope for few good days.
I have 60k riding on AGNC and MTGE, and while things can get worse, I like this idea of holding through ex, with an oversold condition, a premature 10 year spike and the very strong possibility of weak earnings and poor economic data. Ben cashed in too soon in my book, so we might just see a q3 refresh.
I have until jan., but to be clear, I have lost most of my bet. I just can't go down for chump change when the values are unknown.
Anyway, the sentiment is respected. It ain't so bad.