I have made a lot trading swings of 5 cents, and I have a big pile of $4 October puts now. The behavior of this stock is completely different from the normal quarter! IMHO, this means that the insiders know the divvy will be low, maybe 14! Buy in's below 3.80 after the X look very good. I am passing on the divvy (just imagine) for the puts this time. GLA
I took profit on 1/2 my holdings (sub 3.80) at 4.11--what is different is the "no ex divy date by now" syndrome. Alot of services, like ST, were using 3 months from the last ex divy--it ran up in advance, and no declaration. However, they announced that they earned 19 cents--so I dont know why they would drop the divy, unless they didnt raise enough in that placement this summer.
Good observation. Irrespective of cause, I agree with your pattern--buy at 38x and below. Sell above 4.05. At least for now.
"Chimera Investment Corporation Reports Core EPS for the 2nd Quarter 2010 of $0.19 Per Share"
With that said I would love to hear how you think we have loss 5 cent per share for this up coming quarter when there is no bad news to match your claim?
Plus, where did you buy $4 dollar puts? Standard puts are at $2.50 and $5.00 and $7.50 for Oct.
And how much is 90 percent of $.19? If you don't have your calculator handy it is $.17. And why is the 90 percent number important? REITs are required to pay out that amount to shareholders or face the tax burden themselves. So what number is probably closer to the real dividend...? Wait for it...$.17
Assuming facts not in evidence. There is nothing in the financials that indicate a lower than .17 div. Weak attempt at a slam. The behavior of CIM this quarter is similar to behavior last quarter and the quarter before that. The run-up heading into the div is never smooth...sort of starts and stops. My guess is we'll see the pps do the div drop on X-div followed by a small increase and then the drop, as usual, until the next run-up starts.
Quit trying to scare the noobs.
The CEO stated that we are going to be pleased with the action on CIM prior to last Quarter Dividend of 17 cents---holding all factors. The behavior is unusual, shorts have to pay the dividend at this point, but the strategy seems too logical and may not fit the assumed exception that the dividend being below 15 cents. Clearly 14 cents is really not so bad, but he new issues planned following the dividend as is generally CIM's actions, seem rather better to be able to double down for the next lower dividend---due to taxes on dividends.
Personally, I think that CIM management will do their best to meet expectations, the question is should I buy more now? The HEDGE funds know how to do what they want the stock to do, especially if there are leaks from CIM management---just takes one person!
Keep your daily records, logs of the stock, for the SEC, should investors need to take action on alleged misconduct matters. Personally, I think they may have eyes on CIM, clearly a guess. The CIM behavior is a break from the pattern.
As for a stack orders of shorting CIM at 4, sounds like a great five cent profit so far...take it prior to the expected date for the dividend announcement.
Therefore, I would hold your position with cash available.
That strategy worked the last time.
Such posturing grants an opportunity to buy, but there are too many investors and hedge funds at much lower prices.
NLY is a great indicator which shows strength, so my opinion is to hold CIM! We will see!!