Elle Navorski wrote:
- quote -

"you can lead them to water..." (sigh)

Not that this is the most precise method in the world, but pulling up a
chart of the issue and the 30-yr Treasury can sometimes be a helpful
visual. ^TYX pulls up the implied interest rate on a 30-yr Treasury.
Look at your GUQ:
http://finance.yahoo.com/q/bc?s=GUQ&t=1y&l=off&z=m&q=l&c=^tyx

Kind of a mirror image, ya? At least over this time period it looks like
pricing of the security was driven "largely" by interest rates. When
rates rose, it dropped, vice versa. Try it as well for the period you
were talking about and for your other issues, might show something of
interest.

You can refer to old discussions on bonds for a discussion of expected
price changes that go along with changes in interest rates. With an
issue like this I think you might add in a liquidity factor...as you've
seen the market for these isn't as deep as Treasuries or corporate bonds
and I think that amplifies price changes somewhat.

I'll leave in a heavy disclaimer because with this class of income
securities ("preferreds etc") it's asking a lot of us to provide a
precise explanation. That's the nag with preferreds, you need to dig for
each one of them. All sorts of things can drive them down - credit
downgrades, general company business news/prospects, risk of call, risk
of suspended dividend, silly trading blips, issuance of a superior class
of income security, and of course interest rate changes. The latter is
always the first suspect but you can't rule out the others until you
read up, issue by issue. On the flip side it can turn up some good
income alternatives because a lot of people don't bother doing the work.

-Tad

"Steven" <NOSPAMwallstreet71[at]comcast.net> wrote
- quote -

I think it wise to call them neither; hybrid seems a nice fit, but I'd have
to double-check some investing dictionaries.

I wouldn't even call them "fixed rate," as the typical prospectus puts a
number of qualifiers next to the inital yield the company offers.

- quote -

As I queried in my first post: I want to know *why* they took a bath and
then so quickly rebounded. I'd still like to know whether interest rate
changes were truly behind this (as I also suggested in my first post), and
then what exactly happened with interest rates around May.

No one seems to have a precise or sure answer to this question. Guess I'll
take a few hours and google for it. (The moderators grin.)

"Elle Navorski" <elle_navorski[at]nospam.earthlink.net> wrote in message
newsexId.2604$r27.448[at]newsread1.news.pas.earthlink.net...
- quote -


I found you post where you gave the 3 tickers, all 3 of them are fixed rate
capital securities which are considered more of a bond then a stock. A
single issue will take a hit sooner then a mutual fund because the fund has
many staggered issues. Most of the issues I follow took a bath during late
spring and early summer then rebounded in the fall.

I posted a few specific hybrid income stocks earlier in the thread. None
were REITs. The blurb you quoted (which I've seen many a time now) puts an
over-emphasis on REITs, in my opinion. Quantum's income tables list plenty
of, for example, electric utility and banking hybrid stocks, too.

I did check VWESX, a long-term bond mutual fund, and see it took a hit
around May, also, but not quite at the same time as the hybrid income
stocks I listed earlier (among others), and I don't think quite as
dramatically.

"Steven" <NOSPAMwallstreet71[at]comcast.net> wrote
- quote -

this is from quantum:

Traditional Preferred Stocks
This is a table of 717 traditional preferred stocks. Traditional
preferred stocks were the only type of preferred stock issued up until about
10 years ago when trust preferreds appeared on the scene. Now traditional
preferred stocks are issued mainly by REITS, some banks, closed-end mutual
funds, etc. Traditional preferred stocks generally have a $10, $25, $50, or
$100 liquidation preference (issue price) and are perpetual securities that
have no stated maturity date. Recently issued preferreds are redeemable at
the issuer's option on or after five years from the date of issue at par
while the older preferreds are now redeemable any time at the issuer's
option at a small premium. Most of these preferreds pay quarterly dividends
while a few pay monthly dividends. In payment of dividends and upon
liquidation, the traditional preferred ranks junior to the company's debt
and senior to the company's common stock. Most traditional preferreds are
eligible for the new 15% tax rate with the exception of the preferreds
issued by REITs which are NOT eligible.



most of the reit preferred took a hit when interest rates started to rise
from march-july because individual investors typically panic to news,
rumors, etc.

If you can post the symbol of a specific prefrerred stock, we can try to
answer you question...



"Elle Navorski" <elle_navorski[at]nospam.earthlink.net> wrote in message
news:blXHd.1359$r27.1226[at]newsread1.news.pas.earthlink.net...
- quote -

"Rich Carreiro" <rlcarr[at]animato.arlington.ma.us> wrote
snip
- quote -

This is not how Quantum's screeners are set up.

- quote -

If one looks at Quantum's "Income Tables" section, it seems pretty clear to
me that it only includes stocks. No where in the descriptions for the
section does it mention funds; it does use the word "stocks" here and
there. Also, after a week of researching the contents of the "Income
Tables" section, including pulling up many prospecti, checking charts at
finance.yahoo.com and Marketwatch.com and ratings at the SEC via Edgar, I
have yet to see anything that looks like a mutual fund. Lastly, I
understand "securities" to mean stocks or bonds, though I suppose one can
stretch the typical dictionary definition and argue shares in a mutual fund
are shares in a "security."

Another section of Quantum covers mutual funds that are income oriented.
I'd name this section, but we're already pretty far off the beaten path.

I've been using the "Income Tables" section of www.quantumonline.com ,
second menu choice from the left. It appears to me that every security
listed among Quantum's "Income Tables" is a stock, not a mutual fund.

I said "preferred stock issues" at the beginning of this post and, with
some clarification on the meaning of "preferred," that's what I meant:
Stocks, not mutual funds.

- quote -

[snip]

- quote -

And Tad is wondering if, since closed-end funds trade like stocks,
your screen for "income producing stocks" might also be turning up
closed-end bond mutual funds in addition to "normal" income producing
stocks. Because if it does, and because of rate changes in the time
period under discussion, one would expect those bond funds to drop
like that, which might explain a lot of what you were seeing.

So, are you sure your screen excluded closed-end bond mutual funds?
Because if your screen was something like "securities that trade on X
and Y exchanges with dividend yields greater than X%", you probably
did pick up closed-end bond funds, unless the screening program
doesn't have closed-end funds in its universe or was otherwise told to
ignore them.

Looking at quantumonline.com, it's not at all clear to me that
"exchange-traded income securities" would exclude closed-end
bond funds and bond ETFs. If I took "exchange-traded income
securities" literally, I'd certainly expect it to include them.


--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

Elle Navorski wrote:
- quote -

Quantum lists hundreds of closed-end mutual funds on the site, they're
even sorted by category. And in some data sources (and newspapers)
they're listed right with traditional preferreds. You might be looking
at true preferreds, but just make sure of that. (I can't comment on the
specific issues you listed).

Point being that you need to confirm what each "preferred" really is -
it might be a CEF (which is a type of mutual fund), it might be
MIPS/QUIPS/HOLDRS, it might be a convertible preferred, or it might be a
traditional preferred stock, and the assessment is different for each.

-Tad

"Rich Carreiro" <rlcarr[at]animato.arlington.ma.us> wrote
- quote -

For the archives, no, I'm not talking about mutual funds. I'm talking about
the income producing stocks that come up when screening on
www.quantumonline.

"Elle Navorski" <elle_navorski[at]nospam.earthlink.net> writes:

- quote -

Well, like Tad said -- if there was an interest rate rise during
that time period, you'd expect preferreds to drop.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

"Elle Navorski" <elle_navorski[at]nospam.earthlink.net> writes:

- quote -

Because in the stuff you quoted, Tad is referring to closed-end mutual
funds, which ARE mutual funds, but which trade on a stock exchange
just like "normal" stocks.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

Too many preferreds dove-- and significantly--in May 2004 for this to be
due to a dividend distribution. They all returned from the dive within a
month or so.


"JLP" <AllThingsFinancial[at]hotmail.com> wrote
- quote -

"Tad Borek" <borekfm[at]pacbell.net> wrote
- quote -

Can you explain why you are calling these stock shares "funds"?

To be more accurate, I should have called these "income securities," of the
several flavors noted at Quantum, not simply "preferreds."

I'm screening using Quantumonline.com; Standard and Poor's web site to
double check the ratings given at Quantum; Edgar and SEC links from Quantum
to read prospecti; basic charting and stock particular features available
online via yahoo , marketwatch.com, and Fidelity.

See for example GUQ, HTN, FREPRK. (These are the Marketwatch.com symbols.
Yahoo's may be different.)

I understand the rest of your post. Thanks.

Elle Navorski wrote:
- quote -


I don't know how you're screening for "preferreds" but you might be
picking up some closed-end funds that use leverage. That type of fund
has the potential to drop quickly when certain things happen to interest
rates. Some yield-chasing muni fund buyers may be in for a big surprise,
for example.

Generally though - yes, there was a fairly rapid rise in intermediate to
long term interest rates around that time and income securities of all
types were affected. Look up the 10 and 30 year bond indices to see it.
I don't think a 20% drop was typical so you'd need to look at the
specific issues to figure out what happened. My guess is CEF+leverage
but who knows?


- quote -

I wouldn't bother with an AON on such a small order - you're talking
about what $3-5k of stock? If the spread is a concern perhaps put in a
limit at price that results in a yield you'd accept.

-Tad

A lot of times they drop after a dividend payment. Go to
http://quote.yahoo.com and enter their ticker symbols, then go to the
history section and click on dividends only and put in the date range
you want to investigate. My guess is you will probably see a dividend
payment that coincides with the stock price drop.
JLP

http://AllThingsFinancial.blogspot.com

I am studying various preferred stock issues for possible purchase.

1.
A number of them show a dramatic dip around May, 2004; they dropped from
around $25/share to $20/share, typically. Does anyone know the reason for
this? Something happen with interest rates, maybe?

2.
I see the daily "shares traded" volume of many preferred stocks is often
quite low. I want to use "All or Nothing" orders but my broker (Fidelity
online) warns that "All or Nothing" orders have the lowest priority of all
trades. In others' experience, is it best to remove the "All or Nothing"
restriction? I am buying typically 150-200 shares at a time when the volume
trading is typically around 5000 shares. I think I can live with only
getting, say, 75-100 shares, but can anyone say, from their experience,
what the smallest is that I might expect on an order seeking 150-200
shares? Or is it just a roll of the dice?