LUCKI, Are you going Sapphire Blue, or dialing back to Tanqueray until it hits 5?
Once again, thanks for all the help with NBG-PA. Still have a place holder position there of 10,000 shares, going pretty well I guess. Long haul on those last few.
350,000 shares available right before close today. The borrow is 3.0pc. Bad move shorting though, if that is what you are thinking. Just my opinion of course.
There are 7 different brokers willing to lend shares to your broker for you to borrow.
Seems like a bad idea shorting into the presentation tomorrow, but that's just me.
Better go look again. There is stock to borrow 1,200,000 shares right now. The borrow is 2.54pc.
At 9AM there was no stock. But as soon as the market opened, a lot of stock showed up.
Yes. I generally use preferred stocks that I have spent months following and have a comfort level with the underlying company that they can cover the preferred with NAV.
A good example is MHR-PC. That issue is senior to all other MHR preferreds. MHR is on very solid footing fight now in terms of intrinsic valuation. I bought the MHR-C right around par. It is 25.20 or so now. It will be called with in the next year, but there are plenty of other ones out there. It yields 10.25pc at par paid monthly.
So .2135 per month per share. Now this dividend is all ROC, so it doesn't increase your current tax, it reduces your basis in the stock every time you get one. So my gain (dividends) is LTCG.
I borrow money from Interactive Brokers for 0.75pc margin. They allow you to borrow 6.5 times your equity as long as they consider your positions safe and diversified. They stress test your account every 1 minute or so. This does not affect me as I never get anything close to only having 15pc equity. I usually borrow about an equal amount of my equity (all in this typle of preferred).
So I make the difference between 10.25pc paid on the stock, and the 0.75pc I am paying for OPM (other people's money") Hence the margin milking.
The important part is to find preferreds safe enough to do this. CPE is a good one where the company is net debt neutral and they have a lot of valuable Permian holdings relavtive to market the outstanding preferred
(CPE-PA) This one pays 10pc at par 50, and is selling for about 48 now that they are debt neutral.
I have been making a good living on this thanks to cheap margin at IB and the availability of good underlying companies to play the interest spread on.
Don't know who you are on margin with, but I have Interactive Brokers and am only paying 0.75pc blended rate on my margin.
Do a lot of margin milking with MHR, GST, MILL preferreds and stuff like BBEP, LNCO etc.
Not sure if GAry would break every law in the book and disclose earnings to the biggest loudmouth on the planet in order to get on the show.
The one troubling statement he made there is that he didn't carea about profit, but about NAV. I have a feeling the anaylsts may focus on as earnings miss, which Gary seemed to be preparing us for.
PS, I thing D is a buy right now. I haven't added in a year but did at 46.90 today. Just seems like there is an unlimited supply there and don't want to sop it up just to give some non believer liquidty. However lets say it is called in 1 yeaar. 3dollars cap gains and 8.6 interest. Nicer yeidl to call, I think.
In case it got lost, I called you last night, not because I seriously would consider changing, but more because there are hadrly any MHR holders around that are worse bouncing ideas off of. I would be interested in your long term interest in this issue. I have been in the C' since the beginning and same with the D. I fell I paid a little to much have have collected multiple 100,000's of interest (ALL ROC), which is very handy for me to write off against losses experienced in an unrelated real estate transactions. I cannont assume that you know much more about it than I do as own about 0.5 pc of the total float of C and over 0.75 of the float of the D
I have a high confidence in Gary, however, some things are beyond his control. EG he told me and a represntative of mine that they would not do a secondary below 10 and as it turned out they started at 7 and bot beaten down to the 5 area. I will say he is very proactive about defending the preferreds, did you here the hastily called CC for the express purpose of dendending the price of the preferreds. They first question from from Irene (back 10/11) and she asked aout the "funding gap and he yelled at here saying here is no funding gap. doubt that
he has een called on again. Anyway would have enjoyed gettin gyour feedback, although I thinkI have a pretty good handle on the whole thing. I'm afraid this suddend rush to get CC's out there thisweek is just a way to get in front of not top great earnings. In fact he told Cramer last night that earning don't mean #$%$ compared toNAV, that seems like a CTA statement to me.
Anyway, I would be happy to talk to you and share my knowledge. It has sometimes been to bain of my port and sometime feel ebullent about it. Somewhere is between probably is appropriate. You can prbably look through you incomimg calls and return mine if that has some interestto you. Good Luck David.
I called you last night, but you were out. I know you get up very early so I did not call back. I just have to stick
with my C, D. for reasons you list above. Also, the E is junior to both the other issues. I am more concerned with the action in the common lately. It did go up pretty far pretty fast along with all the other small EPs. They have all gotten hit lateley.
I will do it, I would appreciate any input. I own a lot of C and D. It would take me weeks to move it to E, at the current volume. I am not making much money on appreciation, of course, having been in from the start, but b/c of ultra low margin rates, making a lot of interest- all ROC. I will call you this week.
Dave regarding number 4. I hold C, D, E and would love to see that but, from the E IPO prospectus....
The preferred shares are convertible any time at the holder's option into 2.941176 (calculated) common shares of Magnum Hunter Resources Corp. (NYSE: MHR), an initial conversion price of $8.50 per common share. If the price of the common stock exceeds 130% of the conversion price for 20 of any 30 consecutive trading days, the company may, at their option, redeem the shares at $25 per depositary share. This security was not rated by Moody’s or S&P at the time of its IPO. In regard to the payment of dividends and upon liquidation, the preferred shares rank junior to the company's senior debt, junior to the company's Series C & D preferred stock, and senior to the common shares of the company. See the IPO prospectus for further information on the convertible preferred stock and the conversion provisions by clicking on the ‘Link to IPO Prospectus’ provided below.
It's a problem for me. I was trying to buy it! Have pretty much full position on C but looking to initiate D.
Thought I could get a deal with all this extra supply. What an idiot. But tomorrow is another day.
Wonder when that will become a significant factor. Soon I hope.
Guess they can't make them fast enough according to preso at OGIS in SF today. They can only make 4 or 5 panels a day. Not sure that satisfies the market, but could be that they don't have the money earmarked to by more anyway. Very postive presentation today. I'm sure it will be available on the website soon.