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Newcastle Investment Corp. Message Board

  • gogomets13 gogomets13 Apr 27, 2012 12:45 PM Flag

    Momentum or Resistance?

    Has the momentum finally died, or is it just because it has hit the $7 resistance point? Most of the day it has been at $6.99/$7.00 bid/ask. Almost 600k shares traded and really hasn't budged. It seems like it has been losing steam the last couple of days now, but that is to be expected after 13 straight, up days.

    I think we just have to wait for some type of news now. Should be announcing earnings date any day at this point.

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    • Hmmmm. Do you know people like that? It seems that would be a minor issue. If they are adept at getting on the computer and doing trades, they probably aren't too far gone having to remember their passwords and usernames.

    • Ahh, perhaps the drip purchases happen before the pay date. Would explain it.

    • I just checked my account and Quicken file. The trade date of the re-investment purchase was the 25th with a settlement date of the 30th. The cash dividend transaction is shown as the 30th and settled the share purchase. The dividend re-investment downloaded to Quicken as on the 25th. The purchase price was $6.880001/sh. The closing price on the 25th was 6.95.

    • My dividends (both cash received and then reinvested) showed as transactions in my account on the 28th with a date of the 30th. I didn't notice the transactions before the 28th so it is possible they were there on the 26th or 27th. I believe the purchase date of the shares was the 25th. My account balance was unchanged and I couldn't download the transactions until this morning.

    • Mine showed up yesterday also. I'm confused how some stated their divvys showed up on saturday when pay date was 4/30.

      P.S. I have a relative at Discovery in your town.

    • I think you meant 15K in which case I'd be anxious to see my divvy too BD! FYI: My measly hundreds showed up exactly as promised on 30/4, the date I lifted off the roof of the US Embassy in Saigon 37 years ago! Tragic consequences for US credibility in Asia. But not to worry there BD.

    • Has worked for me. Keep some powder dry, buy low and sell high! Yield must also be a consideration. I'm up over 250 percent over the past 5 years and am very comfortable with my current position. I don't do much rebalancing but do have a fairly dispersed holding. I've a strong annuity and am completely out of bonds at this time with annuities and some reserve cash. Am also long with most of my portfolio. I'll stay with what I find comfortable and the hold strategy has worked well for me. Perform DD and understanding risk are also important factors. My position with NCT began at $7 and I leveraged down in the $4's. At $5.5, I'll be content with the dividend for the foreseeable future. Couldn't have planned it better this time!

    • Many good points on a buy-and-hold strategy. It's great for most people, but doesn't suit me. I don't day trade either.

      I will take a position in a stock based on fundamentals and a definite set of expectations. If it doesn't do what I expect, or it reaches my price objective, I sell. Right now I believe that residential mortgage REIT's are probably attractive from both a dividend and price appreciation standpoint. I'm holding a fair amount of AMTG, which was recommended by Bob on this board, but not as large a position as with NCT. AGNC reports on 5/2, which should give me a greater understanding of what to expect from AMTG.

      The residential mortgage REIT's are likely to move more heavily into non-agency paper, which will have much better returns than agency paper. I also believe that non-agency mortgages will perform very well over the next five years, with very low default rates. It is reasonable that with non-agency paper, low short term rates, and a fair dose of leverage, a 20% return on equity can be achieved. If the market demands a 15% dividend rate for such investments, companies can sell additional shares each quarter and still support a rising stock price. I have yet to confirm that a 20% return on equity can be obtained on a sustained basis, so haven't increased my position.

    • Money Magazine, April 2012 issue:
      Letters and comments section>

      RE; Wild markets are here to stay.

      MIT professor Andrew Lo's assertion that buy and hold investing doesn't work anymore is interesting but it is fundamentally flawed from an individual investor's point of view. Buy and hold is, in fact, the only proven and reliable way a small investor can prevent being totally whipsawed by the volatility that the market has displayed in recent years - and is likely, as Lo says, to display for years to come

      Best I could type.

    • Not saying goodbye to $90K, assuming you are holding 180,000 shares (7 - 6.50 = .50, 90,000/.50 = 180,000), you would stand to collect 144,000 in dividends over the course of one year assuming the dividends remain as they are. In addition, in my opinion, any drop will be a temporary drop given the information available.

      In the past, my best performing stocks have done so over a buy and hold strategy extending over several years. And lets not forget that a longterm gain is only taxed at 15% versus your top marginal rate. Nothing to scoff at!

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