Over the next couple months, I intend to branch out a little more from the mortgage REIT sector. With the common shares getting so expensive, I want to be able to offer the buy-and-hold or long-only crowd more great opportunities for catching some income when the market is being less than efficient. A recent issuance by a small insurance company fits the bill. It has a great credit rating, and its common stock is doing very well. The new issue is trading at a yield over 7.9%, and I see potential to capture a 3% to 4% gain within a month or so. Major risk factor on the play is duration risk, but the risk/reward profile looks great.
The opportunity comes in the preferred shares of Global Indemnity plc (NASDAQ:GBLI). GBLIL is a very new baby bond. The offering was just completed and underwriters are dumping a ton of preferred shares. Since the underwriters are there to make money off underwriting and don't want duration exposure, they are dumping the shares rapidly. This creates enormous volume (rare for preferred shares/baby bonds).
Source: Seeking Alpha
Related Articles:
- Who is Ben Grossbaum and Why Should We Listen to Him?
- 4 High Yield, High Risk Dividend Stocks
- 5 Dividend Stocks To Buy And Hold, Not Buy And Forget
- All Investments Carry Risk
- Warren Buffett's Two Investing Rules For Dividend Investors
________________________________________________________________
Subscribe to:
Post Comments (Atom)
Popular Posts Last 30 Days
-
There’s nothing more satisfying that getting money for doing nothing. That’s why dividend stocks hold so much appeal for portfolios. Many of...
-
We've broadened our search to the S&P 500, and also found two high-dividend stocks among the dividend yield leaders of that larger i...
-
Dividend stocks can be a great source of passive income. Not only do they deliver cash into your brokerage account on a recurring basis, but...
-
I believe in dividend growth investing and consider holding strong companies will help me going through any stock market storm. I believe di...
-
Generally speaking, the higher the yield, the higher the risk involved. Since yield is a function of share price, a failing business model w...
-
With bond rates already low and the Fed hinting at rate decreases, dividend stocks are in high demand these days, as alternatives in the fix...
-
What kind of income-generating assets make the most sense? Obviously, those that appear undervalued with respect to the basket/group of stoc...
-
If you are retired, you have likely shifted from building your nest egg to living off your assets. That means you probably gravitate toward ...
-
Warren Buffett famously quipped that if you aren't willing to own a stock for 10 years, you shouldn't think about owning it for 10 m...
-
REITs are reporting higher revenue and earnings so far for the quarter. But one of the specific metrics for profitability comes from the rat...
0 comments
Post a Comment
Post a Comment