if these preferreds, below, go back to their recent highs, these are the possible appreciation potentials>>>
DON'T KNOW IF THEY'LL GET BACK TO THEIR OLD HIGHS....but as we get closer to the next x date...they should run back up....so, around 9.8% yields...or...maybe some nice appreciation (can play it either way...but if they gave me 12%+ going into the next x date in August, I'd probably "book" some gains...)
I haven't been on this board too long...
Oh, maybe over the past 6 months, I'd seen some pretty big pullbacks in some of my preferreds, after they go x...at times, it would be quite "asinine" (6-11% pullbacks after paying out 2.2-2.4% dividends)...but then they'd eventually "bottom out", and rise right back up, going into the next x dates (nice little 3 month cycle / easy to wait)...
So, I decided to "play the dips" whever they were quite large (asinine)...and perhaps go for appreciation over divys...sometimes making 2-to-3 times the dividend return, per quarter. (depends on how decent you are at picking bottoms / cost averaging, etc). And a caveat - there are no guarantees that when you take the appreciation gains over the divys, that the stock will pull back again, as much...i.e. you might find yourself 'frozen out'...but with some cash in hand...to hunt for some others.(but it's actually amazed me that this "game" has gone on as long as I've been watching it...seems like easy money...I'd have thought vacuums would fill...oh well...fine with me. (if they offer me "that game", I'll play along)
but don't get me wrong...buy-and-hold, on the preferreds has been the 'winner' over the past 2+ years...yet, with the steep recoveries in most of the preferreds, the "buy the dip-sell the pop pre divy", has been decent, return-wise. (just one more way to play preferreds, sometimes...when offered)
As for Kahneman...well, he never addressed what happens to the minds of people who "do the opposite", like me...there's a price ! (smile)...I just hope to get a good nest egg...and then put the money in divy stocks...and "retire", before my mind is completely lost.
oh, I love the way to put that..."on sale again today"...ahhhhhhhhhh...yes they are...and well, you either buy em'...or you freak out, have odd thoughts come into your mind to play with your sanity & run away....or, play 'ignorant" like me...and dive in for more - and basically, I am a contrarian...and the boat is not too crowded on the "buy side" (hahaha...c'est la vie...we'll see if my limit orders fill...I got up a tad late, so missed the early morning stuff...)
I just wonder if there are "others" out there, with the same warped views I have on investing...Basically, I'm salivating when things are bad...and not too happy when things are rosy.
And after about 8.5 years of investing this way...and actually changing the way I think about investing...well, it is a bit "odd" / warped, let's say.
It's NOT NATURAL to think like that...to sorta train your mind to get excited about buying stocks when others HATE the same thing you're buying...But over time, well, it's become second nature...and I've averaged over 18% / yr , the last 8.5 years, since I moved my 401k money to an IRA, to see how I might do, by "doing the opposite", most of the time. It's not easy thinking the way I do (and not all that fun, actually...you still feel pain, like others do)...I even think "you" pay a price (if you know what I mean...I think you'd have had to "live it", to understand it). Forget the ego stuff...it's mostly buying into pain...and going thru pain...and seeing how you do, in the end (the final score). That's pretty much all of it.
At any rate...back on 'subject'...the preferreds are interesting (in here)...and I think that has many people spooked...questioning things...and "god" knows what else. But this is what I do...it's never easy to pull out the wallet, when there's blood......and people have to either "make the bet"...or walk away, if the PAIN is too great...(humans tend to dislike pain, of this sort...Study Kahnemann's(sp?) writings sometime, on human behavior & investing decisions...Interesting guy...Won the Nobel prise in economics in the early 2000's...and he's a psychologist ! hahaha...oh, he did many studies on how people make choices, when given certain variables - and basically, boiling it down > most of the time, people (humans) make very poor choices at just the wrong time...generally based not on fact, but emotion.
WE'LL LEAVE IT THERE......
yep...was a crazy day with the SFI preferreds.
They generally take about 3-4 weeks to "bottom out" after the dividend date passes.
I've heard investors say that "buy-hold" is the way to go...and I'll not argue with that - just have to look at the last 2 years, to see that most preferreds have had huge appreciation gains + dividends along the way.('buy-hold' probably returned more than "playing the dips" for appreciation only)
I don't set out to "play dips" on them, per se...but heck, whenever I see some big "post divy" pullbacks, I usually bang on them...Did that with RAS preferreds in late DEC 2010, when they had 10-11% pullbacks...and then they popped up very nicely (but yes, many were questioning why they'd pulled back so much / and I saw the same thing with AHT-D a year or 2 ago...got pushed to 22.50 area...now at 25...)
At any rate, when the pullbacks get to 10%-11% areas...and the yields rise as well...I just buy em'....(and maybe I'll 'buy-hold' this time...We'll have to see how they perform as we get closer to the August x dates again...)