when PSEC dropped to as low as 9.61today, which is more than $1 below its recent NAV, with a whopping 13.8% yield, and so many of you were so busy running your mouths, some even proudly claimed that they had put buy orders for it at $6. Goodness, are they so low-witted? I already told you that it would indeed drop and now would be the time to buy instead of talking. I did. Boys would be separate from MEN. You all just keep on talking and I would keep buying. LOL
The beautiful part is if you get stuck with a BDC with high dividend such as PSEC, what is the penalty? A 13+% yield? That is not a bad punishment.
If you bought your PSEC at below 10, with a 13+% yield that is good till the end of this year and it can probably maintain its dividends with its excessive earnings till 2016, you should have nothing to worry. Now if you bought it at 11 or higher, then it will indeed take you longer to break even. The problem is: if you sell it and sit on a pile of cash, you would do with it? Buy bonds?
It closed at 10.18 yesterday and dropped to as low as 10 so far today.
I sold some of my shares at 10.28 yesterday and was unable to buy it back on the same day which proved to be lucky since I bought it back today, on its ex-div date, at 10.02. That is a difference of 26 cents which is a bit more than its dividends for two months.
Same happened with PSEC in last month also, that it dropped on and after its ex-div date, a lot more than its dividend.
It may drop below 10 in the next few trading days especially on next Monday, June 2, the first trading day of June.
Get your buy orders ready if you want to buy some more.
Of course, there is nothing wrong for you to just hold on to all of your PSEC shares and enjoy your dividends.
However, there may come a point PSEC may become overpriced and one has to sell it.
because there is a great chance for it to tank below $10 again, and again by the end of October.
When it tanks and stays at the low $9s,MEN will be separated from boys. So many of these posters talked so BIG here and kept saying how great a stock PSEC is, we will soon find out if they are full of convictions when PSEC tanks again or just full of HOT air. Most of them had been trying to blame the recent fall of PSEC on either the Russell Index or a sell off of large institutions, without realizing that the biggest culprits are little investors like them who had only bought PSEC for its apparent big yield and then selling in fear every time some bad news came out that caused PSEC to fall. This can and will happen again and June is actually quite susceptible for a overall market correction. Based on what happened lately, the BDC sector will remain very volatile in months to come, every time there is a rumor that the FED will raise interest rate, the market especially BDCs will get hit hard. For myself, I already put in a large buy order for more PSEC at 9.50, then more at 9.18, just in case. Of course, PSEC can very well rise above $10. I already sold off some at 10.28 and will continue to sell off more if it rises above 10.30. You should decide what you should do with PSEC in the long term: hold it, sell it when price rises or buy more when price drops. DO NOT listen to what others tell you, including this message. The funny thing is I had seen so many of the posters here continued to buy HIGH and sell LOW. LOL
No, their EPS, even dropped to 1.02, would be more than sufficient to sustain their 0.24 qtr dividend.
So you mean "Effects"?
Affect is a verb, not a noun.
What PSEC did is nothing new. Quite a few BDCs have subsidiaries under which applied for SBIC licenses and make SBA loans. A few have floating rate capitals, such as FSC has FSFR, PNNT has PFLT, making loans between parent company and its subsidiaries. ACAS, a BDC, owns and manages both AGNC and MTGE, both REITs and a floating rate capital, ASCF.
In short, if SEC really wants to dig deep into the accounting of these BDCs or REITs, they will find something.
PSEC is not and will not be the first BCS who is investigated by SEC.
Well, why would any ETN pays you a whopping 16% yield if it is not risky. You are betting on BDCs and therefore on small caps. You would be highly rewarded if you are right or greatly punished if you are wrong. May be you should buy some insurance on both? I would rather buy CHKR than BDCL, yield is higher, risk is almost equal.
Any data that may be worth watching is the amount of margin debt. Margin debt had reached its ALL TIME high of 450.2B (billion) at the end of March, 2014, started dropping off to 437.1B at the end of April. If this trend continues at the end of May (date not out yet), then watch out because last time Margin Debt reached its then all time high at the end of July, 2007, the market started tanking badly about 6-7 months later. Of course, history does not necessarily repeat itself and on one single factor can predict a market correction. Thanks to the ECB, QE has now started in Europe and there may be a lot of legs left with the stock market.
That is why none of you are millionaires because if you are, you will care about every single dollar if it belong to you. How do I know, because I am one. LOL
Please call 1-888-LUVJADE and they will provide you with subscription info for my newsletter and if you mention this message, you will receive a 10% discount.
Wow, a lot apparently. You see, Slick said he had continuously made money by trading PSEC for more than 82 times. I did not hear from him lately. It does not really need a BIG spread for one to make money from trading BDCs such as PSEC. A 12 cent spread will mean good money for a day's work for a trader because many of them traded in 10k shares increment or more at a time. There are some day traders who make money just like not all investors make money, especially by buy and hold only.
It is a good thing you do not invest for a living, judging by the idiocracy of your title and goofy remarks you made in your other message:
"osulin oh osulin you are so schnuckelin ."
First of all, your statement " its an high income yield stock with a solid history" is debatable. Solid history in what regards?
If you have followed the history of PSEC you will know:
"By way of background, Prospect is one of the few Business Development Companies (“BDC”) which cut its dividend in 2010, from a quarterly pace in March of 41 cents a share to just over 30 cents. See our commentary of June 22, 2010. The company reduced the ire of its shareholders by switching to a monthly dividend from a quarterly one, which is very popular amongst retail investors,.."
It is true that PSEC has been gradually raised its monthly dividend to the current 11 cents, but that is only about 33 cents which is still less than its previous 41 cents.
Also, by issuing more new shares via numerous ATM programs, PSEC had doubled its outstanding shares in less than two years; that is not even including those shares that can be converted when their senior notes reaching certain prices. In short, the dividend payable of PSEC kept on increasing while they continued to raise their monthly dividends. So far, I have to give them credit in being able to making enough new investments to continue to pay for their high dividends. Everybody is happy. Unfortunately, in this low-rate environment it has become more and more difficult for both BDCs and REITs to make a lot of income. Therefore, recently quite a few of them had no choices but to reduce their dividends. What that happened, their stock prices got hit hard. PSEC so far refused to decrease their dividends, but sooner or later, some of their dividends may come from ROC instead of NII. Therefore, do not expect to see any capital appreciation or increase of NAV on it soon. Ain't happen. Is PSEC still a good buy, yes, at the right prices.
I sold some of my PSEC yesterday, a day before its ex-div date, at 10.28. Why?
I have too much of it, some bought as low as 9.30 and some at 9.70, some time it is not good to have too many shares of a stock no matter how good it may seem;
past history shows that its price always rose prior to ex-div date and started dropping more than its dividend on or after its ex-div date;
I happened to be right and bought it back today at 10.02, a gain of 26 cents which is about 4 cents more than its two months' dividends ;Is itstupid to take profit? I guess your goal is not to maximize your returns? May be you are the idiot?
Of course, there is nothing WRONG whatsoever for long term investors to buy and hold PSEC to just enjoy its dividend. But for you to bad-mouth others who may have a different investment style than yours? You are nothing but a rude idiot!!!
The problem is the higher the dividend, the higher the possibility a BDC may have to reduce it if it cannot maintain its NII or it has to use ROI to pay for their dividends. There is no other way around it.
In short, despite a high dividend, if the price of a BDC continues to drop, what good will it be?
In that regard, MAIN may be one of the better BDCs out there if bought at the right price. I bought a bunch of it when it dropped 7% in one day because it was simply irrational for a good BDC to drop that much. You better learn in how to buy good and underpriced BDCs and not just buy any because of their high yields because no good thing can last forever. Be warned.
If life is that simple, things will indeed go as you predicted and everybody will be happy and we will have more newly minted millionaires .....................or NOT
A few BDCs rewarded their investors by paying them special dividends, like MAIN on top of its regular monthly dividend of 0.165, it had declared a special dividend of 0.25 for last December and had just declared another one (0.275) with ex-div date of 6/28/14. If it can continue to pay a semi-annual dividend of at least 0.275 in the future, plus its regular monthly dividend of 0.165, at its today's price of around 31.53, it is a respectable 8% yield, not the 6.28% that was shown. I was extremely fortunate to see it dropping 7% without any reasons on 5/9 and bought some at 28.76 and 29.11. I believe if MAIN drops below $30 it would be a good entry price, below 28, ALL IN time. If there is such a thing as Blue Chip BDC, MAIN would be it.
Its dividend appear to be safe till the end of this year. If it can continue to sustain its dividends past 2014, then you will be a genius who made a wise decision. If for any reasons it has to reduce its dividends (not likely), then better watch out. The only problem is that its NAV will continue to drop.
I am kind of surprised to see so many trashes being posted by one person, sole purposes of which are to bash TAXI.
But why? If you hate it so much, why do you not short it to death with all of your money? Why kept bashing it? Did you lose all your money because of it? Just wonder.