And definitely those look attractive on their face. No, definitely in a market like this, we’re looking at all sources of capital. Wouldn’t you choose to keep those liabilities and look at that as an asset? I mean, given the turmoil playing out today, and recently in the capital markets, and just extreme levels of interest rate volatility. Even excluding the troughs, the cost is between 475 and 550. The weighted average duration is 3.2 years, the weighted average cost is 4.79%. Here’s the interplay with an analyst from the last CC: Eliminating the preferreds will help with rating agencies so I think that lessens their sensitivity to interest rate changes as the primary motivating factor for calling…. That being said, I believe there are covenant reasons that the debt will be retired and as to the preferreds, overall they represent a very small percentage of their capital structure and part of Jay’s goal is to begin the new STAR as an IG company with a relatively simplified structure…. That was their original plan and still is what they think is best… That being said, Jay did leave the door open to change in the last CC and lay the issue at the feet of the special committees regarding the merger plan both at STAR and SAFE…. Martin – I’m a believer that they will take out the preferreds and the outstanding STAR debt issues, even though the STAR debt is between 4.75% – 5.50%….
Hard to trade because of the wide spread and front running robber barons but when it happens it’s good.
AGNCO was also in the mix but been too high for awhile now.įinally AAM-A vs AAM-B virtually i=demntical but the prices =]are ]all over the map both upo and down and between each otjer. So,etimes there is a reason since one os fixed and one floats but that doesn’t account for all of the moves. MFA-B vs MFA-C have also bounced around a lot. Hard to compare because they are so different but with the price varying from $2+ higher to less than $1 higher and everywhere in between why not trade against the inefficient market.
#DIVIDEND CAPTURE STRATEGY FULL#
I don’t always capture the full 4% but I don’t need it all to make a profit.ĪGNCL vs AGNCP has been interesting. Both are similar other than L being 10-15% lower both current dividend and floating dividend. Only 5 more dividends before they both float at the same level and no way F makes up more than $1 difference. Major mispricing, recently barely $1 lower where it belongs.
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