$29 is a high price for VNR and $30 unlikely to come. It may be getting close to think about exiting above $29. Another stock offering by VNR's is likely with the last being February 2013. Each time this happens the stock drops 3-4% but recovers gradually. Sell some and buy back?
My strategy has been to buy (in the mid 27's) and to hold, reinvesting the distributions. Of all things that I own, this is the one that I'm least interested in selling regardless of price. But do whatever works for you.
I'm on "set and forget."
I will do what works for me.
Bought LINC at 28 and sold for 32. Bought back at 28 and it is at 29.60.
Bought VNR at 25.91 and will sell some at 29-30 then buy back on the correction.
Point is they will issue more share soon which will dilute it and drive the price back down to below 28. Then its buying time again. It's a historical trend.
It has cycles!!!
sold mine today and will buy back when it dips with the secondary. I understand what you are saying about taxes etc but when you can sell something at a higher price than you think it will be able to bought in the near future then I like to do it. at some point you are going to pay the taxes anyway so if it is next year or this year does it really matter? getting a lower cost basis should always be the goal.
I think the goal should be to make money. That means not incurring unnecessary commissions, additional unnecessary current taxes, and another opportunity to be wrong in your timing if the market doesn't do exactly what you want it to do at the exact time you want it to do it..
I find it best to do nothing most of the time except wait, and wait. It's something called patience
agree with buyandwin - if this is a taxable account and you have held for any reasonable time, the tax recapture on the distributions will outweigh the little gain you make from buying back at a lower price.
OK to do it in an IRA though.
IMHO there are only 2 reasons it would be OK to buy in an IRA.
1) You only have available funds to buy in the IRA.
2) You realize you are giving up valuable tax benefits by doinfg it.
In a non-IRA account the bulk of the distributions are basically a return of capital and reduce your basis so they aren't income and shouldn'rt be taxed at all. In an IRA it is lumped in with other un-taxed funds and bulks up your IRA which eventually will be taxed to you at your highest taxable rate when they are withdrawn or will be taxed at your heir's highest rate when they are required to start withdrawing funds the year after your demise.
Liza, I don't know how old you are--but at 70 1/2 you will think a lot differently about your IRA. It builds up the estate tax obligation and then it will be taxed after at the highest regular rate you (or heirs) reach. The real sad part of it is. The bulk of the distribution was a return of your own money and shouldn't have been taxed in the first place and definitely not twice. Thats adding insult to injury.
. No point in selling and creating a taxable event and at the same time giving up the mostly tax deferred distribution that keeps rolling in month after month and I keep dripping the distributions into additional units, so each month I have more units to receive more distributions going forward. Actually a lower price would be more benefial to me as I would receive more additional units with each distribution at a lower price.
Warren Buffett said you only benefit from a higher security price if you want to sell it. If you are buying you benefit from a lower price. Price is what you pay. Value is what you get..
The long term value of each unit of VNR is the same no matter what you pay for it. If you are buying you get more value if you pay less per unit, and I'm buying.