Late Night Greetings!
For those wondering when to sell B4 EX in the next 6 trading days. You might take a tip from history. Out of the last 19 quarters, selling 50% of your loot on the Open of X-2 and the other 50% on the Open of X-1(someone please explain to YBF what X means ..;-)), as opposed to either or both day's closes, would win over any other iteration I have found in the odds of 13/5/1.
That is 13 wins for the fashion I described//5 wins for the two days Closes, and one BE between them.
More of the winning quarters in the method I describe(Open) were significant (% delta), compared with the Close winners(% delta).
Another stat is that the average run from 6 day's out to EX averaged approx. 65 cents across all quarters.
This then places us at approx 33.00+/- by next Friday(15th). Trade/buy accordingly.
Just another late night benefit from your resident insomniac...;-)
Good luck to all Longs!!
Being a numbers guy, happiest when surrounded by piles of spreadsheets full of historical numbers and graphs, I tend to be surprised and indignant when reality fails to follow prediction. Starting about three weeks ago with a predicted high of 33.71, I have gradually come down to a range of 33/33.3, with a slight possibility that we have already seen the high for this period.
Each trade is unique and can do anything. That is the certainty of uncertainty. Having said that we have an edge with AGNC's probable outcome this next week. I totally expect 33.00+, hence my involvement in the trade. What is important for us all to realize is that it could go against us for a loss.
I have to learn not to feel badly, but just take this as the cost of uncertainty. Trading again next time when the probabilities are in our favor(edge), but fully realizing that any outcome is possible for that unique trade.
If we let losses to become painful it will dampen or destroy our effectiveness as traders. This is a fun business. To be consistent winners we must continue to trade and not allow emotions, like the euphoria of a streak of wins to make us think we are invulnerable and double or triple down, or to allow pain from loss to sway us from staying out of the next trade.
If we accept each trade as being unique with the uncertainty of its outcome a calculated pre-trade conclusion, we will become consistent effective winners over time, since we have the edge of the probability of the profitable returns over time.
This is how the Vegas Big Houses make their fortunes. They realize their patrons might have winning streaks and that the House will suffer losses(their published success probability is 4.5%...meaning their return is 4 and 1/2 cent out of every dollar traded...so 22.5 million a year traded on the Roulette table returns just over 1 million dollars) but over the course of time they will make money.
So it is with these 5 stocks we have been hammering out. Look at the incredible edge they return over time, much more than 4.5%. ARR returned over 30% annually. I did follow Jt's lead and took .30 off the table on 6,000 shares of FSC yesterday, leaving the rest for X-1.
It is almost too easy and yet it is so hard for 98% of people to understand and then implement what I have just been describing. It takes time and mine is running out...;-)
I just bought another 10,000 share equivalents in going Long 100 of the Mar31Calls @ 1.42. I think 33.00 is probable by next Friday(.65-.70 avg run from announcement), which would be $5800 profit.
To answer the MLP question, I plan on going Long LINE at 14 trading days out to EX. This is a consistent historical marker for almost 100% historical gain, of roughly .75/share average. Last two quarters were 2.00+. third quarter back was a loss. Going back to Dec, 2008 this has only missed twice! I like those odds...;-)
The historical lows for AGNC post EX are 13-16 days and 33-36 trading days post EX. This varies, but those are the average historical lows going back to inception at the IPO, May 2008.
I have not looked at MTGE. I play short Puts on MTGE, so timing is not as critical as with Calls or shares.
I disagree..... just look at historical moves after announcement. Today's action is as normal as apple pie to being American..look at 33.00 as being the high on the 15th..;-)
Good luck to all Longs!
Thanks to Doc's positive outlook on AGNC, I was inspired to buy 100 Calls today. But I went for the Apr 32's. Around 9:35 am this morning I was able to get them for about $0.56 - $0.57. Now they are looking "positively green"!
P.S. Anyone heard from FlightNurse lately? No FN posts?
As regards your projections for AGNC's "high" and "best date to sell", my calculations are very similar. I have noted the following:
Over the last 2 years (throwing March 2012 out as an anomaly), from the closing price on the day of DD, to the highs prior to the X-d (s), AGNC has averaged a .93 gain. As the closing price last night was 32.21, adding .93 would give you an average high of 33.14, with a range of 32.61 to 33.79. Based on the foregoing, my current target is 33. As regards the best day to close out for the highest profit, over the last 2 years, the high was reached 37.50% of the time at X-d minus 1 trading day, 25% of the time at X-d minus 2 trading days, 25% of the time at X-d minus 3 trading days, and 12.50% of the time at X-d minus 4 trading days. The average comes out to X-d minus 2.125 days.
I will probably sell prior to the Thursday/Friday window next week, should the price reach my target. I'm trying very hard this year to not let greed get in the way of taking good profits (just GLAD to pick up CRUMBS). Having said that, I kind of like your idea of selling half on Thursday, and half on Friday. Statistically (based on the last 8 Qs), there is a 62.50% chance of the high occuring on one of those days. Regardless, good luck with your positions. Let's put some profits "in the bank" next week.
I'm hoping that the market had priced in a possible dividend cut,and now that the divi stays unchanged,Agnc will move higher than 33.
Doc,are you buying the MLPS when this run is over.I asked you about Line when it was getting hammered,you said it was too far away from it's divi run to enter.Historically when is a good time to enter the MLPS?Thanks in advance!
thanks doc.... useful info for sure
i've done some work on a few mlps and bdc but not on reits on when to buy in the cycle.
just checking before i start running numbers here at agnc and mtge..... have you done any work to see historically when the after ex day is when these plays reach their low pps before turning northward?
i know secondaries in reits are more common than many other divi / dist payers so this may not be as useful or easy to calculate.
Yep, saw that, too. Originally I looked at how the SPO was priced at 31.60 but trading (accumulating?) at 31.70 to 31.75 or so. Add the pledged 1.25 div, we get 32.95-33.00 as a target pps. We'll see!!