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Prospect Capital Corporation Message Board

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  • wiseinvestor338 wiseinvestor338 Sep 19, 2012 1:05 PM Flag

    A Wake Up Call

    Well PSEC went back up today. sold it for profit,

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    • will you wait for some particular event/news and get back in? if so, what would are you expecting?
      will you stay in cash in the interim? if not, what will you put it into?
      i also sold when it ran up this last time for 7 months of dividends. thinking they will do another SPO, then will get back in . meantime, only thing i've found that interests me is OHI.

      • 2 Replies to lstfltout
      • Yea, if there is another SPO, downgrade or any event that will cause PSEC to drop 3% or more, I would get back in. The dividends of PSEC has been very stable and they almost never cut their dividends, but would increase 1/10 of a penny at a time so that they can continue to say they have continually increased their dividends. But at its current price level (closed at 11.78 today) it was already sold with a 9% premium, therefore it might have already reached its peak (at around 12.25) and with only a 10.35% dividend, is it worth the risk? Only you can decide. I would rather buy and hold some REITs such as IVR (recently dropped drastically after its ex-div date) which has a 12.79% yield. It actually has better ratings (Go to Nasdaq) than that of many BDCs. At this time, some REITs (not ALL) are really better buys than most BDCs..

        Many REITs had issued preferred stocks recently and quite a few of them had good yields and good appreciation potentials:

        NRF-PA, PB (more risky)

        or Pref. stock CEFs: PSF, JPC, FFC, FLC, HPF

        Other income CEFs to consider: WEA, CHI, KMM, GDO, DPO

        these should comprise part of your core portfolio due to their better safety (comparatively speaking of course) and stable yields. Of course, they can be quite boring, but boring is good especially in a volatile market.


      • Be wary of OHI, there are reasons it is selling at 200-300 basis points higher in yield to the better of breed healthcare REITs.

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