Seriously? Look at the history. I wouldn't be surprised to see this trade in the 13s. This was not panic selling, it was simply a fund adjusting to the reality of the new yield. With the significant premium that this fund carried, it deserved that type of sell off. This fund usually trades around a 7% yield. Would not be surprised to see it back there again, particularly since interest rates are expected to increase later this year. Wait until the distribution is paid and those shareholders that don't realize there was a divy cut yet start to digest the news...
Be careful, they made a very significant cut to the dividend. I would not be surprised to see this trade into the 12's. When the dividend was this low before, it traded with a 10% discount to NAV. Admittedly, that was a different interest rate environment, but this thing usually trades around a 7% yield. With rates expected to go up, I wouldn't touch it until we see 12/share.
You never know, they seem to have some pretty intense structural problems at the moment. Hopefully they can work through them. Can't imagine them not lowering future distributions. Nevertheless, and for the record I purchased more at 5.83.
Backed up the truck today at 12.77 for an insane 15.5% yield. Never thought it would actually hit, but oh well. Also sold 12.5 put options. I love market panics.
I think the oil price drop has a lot to do with it, I think that is happening more because the dollar is strengthening over anything else. I also think, people will be kicking themselves in the days to come that they missed these levels. Everyone always wants to get it at the bottom. I have only been lucky enough to have done that one time in my life with NKA and that notwithstanding, I'm doing ok.
The problem is you never know when it's going to bottom. While I would like to buy at the bottom I don't mind buying at yields like this, because one day these purchases will be quite low compared to the market.
I hope so, and so might the next day. My strategy is to buy at increasing yields like this 14%, then 14.5%, then 15%...
Well stated. It's precisely the reason to buy and hold this stock, because nobody else wants to. If the average investor would finally realize this, they would be a lot better off. Instead it seems like they are very reluctant to buy stocks on sale, precisely the opposite of rational consumer behavior.
Bought at the market price of $10.15 and then sold the same number of November $10 puts at $0.65 for a net price of 10.15-.65 = $9.50. If the puts are exercised, I will end up buying 1/2 of my current position at $10.00 for an average cost of $9.75. Either way I just bought below the already depressed market price of around $10.10. And while I wait, I get a yield north of 13%! Bam.
Why aren't you excited that this is on sale? Shouldn't you have done the exact opposite and bought more? Sell low, buy high? This is why the majority of "investors" can't beat the averages.
I think you didn't get the memo. Yes there is going to be a dividend decrease. Witness: News from Dow Jones on 10/31...
Rhino Resource Partners Sees FY Cash Available for Distribution $43M-$47M
Based on their shares outstanding of about 29 million, then dividend should be around 43/29 = $1.48.
Still about 15% based on current pricing, so I'm sort of scratching my head here as to why RNO is trading this low. Perhaps it's end of year tax loss selling.
Now I think it's time to buy, or at least begin to establish a position. I got in at around 16.45. I hope it goes even lower so that I can buy more.