"While U.S. traders enjoy the President’s Day holiday on Monday, they’ll be keeping a cautious eye on the reopening of markets in mainland China following a week-long Lunar New Year holiday celebrating the Year of the Monkey.
Caution is required after Asia markets were hammered last week, and mainland stocks are expected to follow suit. Last week, Hong Kong’s Hang Seng Index HSI, -1.22% , which was open Thursday and Friday, fell 5%, and Japan’s Nikkei NIK, -4.84% tumbled 11%.
Additionally, the Hang Seng China Enterprises Index HSCEI, -1.99% which tracks mainland China stocks trading in Hong Kong, dropped 6.8% over the two-day period."
Well said, phil. Thought I would like to add that no matter how good a BDC may be, they are still basically junk bond funds. When MAIN rises higher than $30, you have to start liquidating it. GARS was my previous no. 1 BDC but now there are simply too many better BDCs to buy, not saying it is not still a good BDC, but its upside potential is simply not as good as others. If you really want to get one with a great upside potential, try to get PNNT at 5 or under. From everything I had read so far, including comments in Yahoo MBs, PNNT will announce the same 0.28 dividend on around March 2-4, that would be a 22% yield. I simply cannot see PNNT will not rise 5% or more soon. As a matter of fact, if PNNT won't drop in the next week, I may have to add more at higher price. Like you said, who are still buying PSEC, not that many retail investors, many of them already got burnt. When PSEC rose 19% 3 days after Feb. 8, the chance of people taking profit next week is very high. Of course, it can indeed rise to $7, but the chance of it dropping back 5% or more, IMHO, is just as good or better.
Don't hold your breath, on Thursday in Hong Kong The Hang Seng Index sank 3.9 per cent and the Japanese Nikkei tumbled 4.8%, when the Chinese market opens on Monday, it can be very ugly. If oil tanks on Tuesday, the US market will tank with it.
It did not drop that much yesterday when oil and market tanked. If it would declare the same dividend of 0.28 at around March 2-4, it will pop.
With a 12 mo range of 5.21-8.85 for PSEC, its mean is about 7.03. Its -1 SD is about 6.12, it closed at 6.17 today and therefore it indeed has pretty equal chance for it to to to 7.03 or dropping back to 5.21. I am playing the odds here, for it to rise 19% in 3 days, I believe it may give back 5% or more in the next few days. We shall see.
I have to readily admit that it would indeed be hard to forsake a 17% yield, but what could go up will come down and vice versa. Therefore I was chicken and sold half of those PSEC I bought at around 5.34-5.38 on 2/9 yesterday at 5.84, sold half of the remaining shares earlier at 6.21 and decided to sell the rest at 6.15, not that I do not like the yields or discounts of PSEC. I do but this market can change rapidly and with China's market opening back this coming Monday (Sunday our time) and Monday is a holding for us, if the Chinese market tanks badly for its first two days, watch out.....
Of course, once again my timing some time sucks, but I am happy with taking profit. You must decide what you need to do with your PSEC shares. Have a great weekend.
I also sold a lot of MCC and all my AINV to take profit. Sold some SCM and CMFN yesterday to take profit. The balances of my accounts look like yoyos this week.
Please understand that my timing was never perfect and I surely could not always time the bottom or the top of the market or any stocks 100%.
Okay, for those of you who had the guts to buy some PSEC on Feb. 9 before it announced its earnings, that is absolutely nothing wrong to hold it and enjoy its next three months' dividends.
However, after it had made its new 12-mo low of 5.21 on 2/9/16, it closed at 5.82 on despite the market dropping badly yesterday, it closed at 5.90, that was a 13.24% jump from its 12-mo low. Then it rose as high as 6.24 today, another 5.8% rise. Can it continue to rise? Absolutely. But that was already a 19.04% rise in 3 days.
Thanks for the head up, tulsa. A thumb up for you. Do not why anybody would give you a thumb down. I believe he/she must be jealous.
Another thing I would like to point out is that he thought he was so smart in believing he knows everything, how vain. While it was true that Fidelity does use FIFO when one places a sell order, that is not true with E*Trade which allows one to sell any specific lots, therefore it can be LIFO or whatever you prefer. This can be significant some time because certain lots could be bought with unsettled funds while other lots (either bought later or earlier) can be sold because were bought with settled funds. It always amazes me why anybody would have to act like a Mr. Know-it-all on everything. I would readily admit that there are a lot of things I do not know and I am very happy to learn it from others even though I may not necessarily agree with them. Can we not get along nicely without having to insult each others? Did you ever see me saying things like "you are dumb" or "your are a fool" to him even though some time I really wanted to?
Thank you for sharing that with me. Wow, DWTI is the best buy, he must be either senile, unlucky or?
It dropped as much as 21.7% today and currently down 16.14% and he claimed he made 1M dollars from trading DWTI with his timing? How funny!
He must be losing a lot of dollars indeed. LOL
when most of my holdings, many are BDCs, trading in the GREEN. With PSEC popping up another 4.66%. Of course it was indeed funny to hear a person who had bad mouthed it so much on the day before it announced its earnings, then when it popped with great earnings, his message was conveniently deleted and he claimed be bought 10k shares right before closing on the day before its earning announcement. May be he was telling the truth, may be he lied. I really do not care any more. Nobody can win all the time because this market could be so very unpredictable. I bought like crazy yesterday and was lucky to see the market bounced back today, it could go the other way. Why did this person was so gun ho about what others did? I do not know. The only reason I put him in ignore, not because of his bragging or even his lying, but why did he need to demean others (including me) by using statements like "your are dumb" or "you are a fool". Why indeed? The only reason is because he has low self esteem or none whatsoever?
So all these people, every time they were losing an argument, they would start insulting others or said they were using all these other alias, without even able to tell the subtle difference between each poster. I really really wish Yahoo will re-open the PSEC MB and all these "refugees" who migrated from there can return to their "homeland". No wonder Germany is now running into so many problems after they had accepted all these immigrants from Syria. I believe they now have second thought.
With a 12-mo range of 4.53-7.36 as of today, its mean is about 5.95. That means its chance of rising to around 4.84 in the next 2-4 weeks is extremely high barring a total market crash. If it rise to around 5.95, you almost have to sell some of it (previously it dropped to 4.75 on 1/20/16, then rose to 5.98 on 2/2, then started tanking again) and then try to buy it back later. On 1/15, it made its then 12-mo low of 4.65, rose all the way to 5.24 on 1/19 before dropping back down to 4.75 on 1/20. It then made a new 12-mo low of 4.53 on yesterday (2.11). I cannot guarantee that it would not drop again, but it appears 4.50 may be a supporting level unless there are more adverse news coming out (it will). However, at its current price of 4.65, that is already a 44.7% discount and a sustainable 15.48% yield, IMHO. So if it would drop if oil tanks, says dropping to a 50% discount, its price would become 4.21, and its accidental yield would become 17.1%, how long do you believe it would stay at this price?
Of course, anything can drop unreasonably low and any companies can go broke, but....
Of course, you should not buy FSC or any stocks I mentioned since they can all be falling knives. I really wish it would drop closer to 4 so I may add more. I still strongly believe FSC will and can rise to or above 5 in about 30 days. Of course, I had been wrong before, otherwise I would be a billionaire by now.
Even with a NAV that dropped to 8.41, I simply cannot foresee they would have troubles in covering their current monthly dividend of 0.06 (0.72 annually) for this year (yes, that long). It would also be crazy for them not to buy back more shares since a 100M buy back was approved on last November. They can indeed save a lot of money (dividend payout) from buying shares at its current low price. With the rebellion of activists and the threat of Rivernorth's taking over, they would continue to be vigilant and would continue to reduce their management fees. The chance of their issuing new shares in the immediate future will almost be nil, IMHO. It would be hard to predict the impact of oil price on it if oil would indeed continue to tank. However, my friend believes by June to Sept., oil price would almost definitely start to rise because OPEC would come to an agreement to reduce their oil productions and it would not take a lot of cut to cause a rise in oil price. Now the market always start to get worried when Yellen mentioned rate hikes, however rate hikes especially those that are great than 100 bps would be great for FSC and better for FSFR. In that regard, I simply cannot see oil price, even if it may drop to the low 20s will have siginficant impacts on many BDCs which are currently traded with 40% or higher discount on their already reduced NAVs. That said, when fear permeated in the market, investor will do strange things and there can indeed be another sell off of BDCs including FSC. My advice for myself is you should never ever hold any BDCs for too long, if any of them rose 10% or more, you almost have to sell some or all of it to take some profits (or losses if you bought them at higher prices) so that when they start dropping again, you can buy back the same number of shares but you would have more cash and lower the average costs of your shares. Of course, you should make your own trading decisions. I will not sell my FSC shares too cheap.
Lately, I saw a lot of articles pumping AGNC and other REITs. However, since most of them employed much larger leverages than BDCs, with lower yields and lower discounts, and with a possibility that Yellen would indeed be crazy enough to continue to raise rates this year, I will stay far and far away from REITs especially AGNC. The only REIT I still have is NRZ which I bought at 9.25 on 1/20. I would rather nibble on AINV especially if it would drop closer to 4. Currently, BDCs are so much better than REITs, IMHO. Of course, I can be wrong and everybody should decide what is good for them and should not buy anything I mentioned in any Yahoo MBs.