NHF just had a very nice windfall with the acquisition of Young Broadcasting. They've got a few other sweethearts in their portfolio. The fund has become more equity-centric under the direction of James Dondero, however I suspect having "credit" in their name has caused them to get basted with the same brush as other bond-orientated funds. They look well positioned for the year ahead and Dondero just bot another million dollars worth of stock at $8.11/share.
I think we just got our answer on the HLSS secondary -- OCN announced a big MSR purchase after the close -- this will most likely be resold to HLSS, which will in turn fund its purchase of the MSRs from OCN with a secondary offering. HLSS then, of course. subs back the actual servicing to OCN. In this manner, OCN puts out very little capital (that's HLSS job) and retains the actual servicing function.
Another large buy by NHF portfolio manager, James Dondero, who purchased $1 million of stock last week in the open market at $8.11/share. Considering the large portion of the fund invested in equity holdings and non-fixed income, my guess is that they are well positioned in the current environment.
I think you're absolutely right. The Fed is completely locked into QE and will not be able to taper this year, or probably next year. If they do taper, it will be only marginal. Vranos & Co. have made $billions over the years by correctly reading Fed strategy and I concur that they are probably in the midst of what will be viewed in retrospect as one of their most profitable periods of 2013.
In 1980, J.I. Case (Tenneco) already owned a line of agricultural tractors, did that stop them from acquiring their near mirror competitor International Harvester? NO. It's all about market share, and there are many markets in which both companies compete, however that doesn't mean GE is currently the leader in all markets in which is competes. There are quite a variety of reasons why DRC would be a very interesting fit, although there are certainly other potential acquirers which would no doubt have an interest.
I do think Vince has a game plan which will result in DRC becoming part of a larger organization. I think he wants to tweek up numbers and then put it in play. Either that or someone like Icahn will start the process. The stock bumped up after his buy a month ago and then came back down when some lower tier executives sold a bit -- I don't think they are aware of what will happen with DRC over the next 12 months. I saw EXACTLY the same thing occur with Hess -- major buying by the CEO, and then 12mos later the company is being broken up with very nice return for shareholders.