Selling my TCAP today

Just a quick update on a former investment. I am selling TCAP today. Its had a great run with it getting a 60% gain for the old Model Portfolio. But earnings is this week and I don't know if they will meet expectations. That's a lot of money on the table....

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

Week 92 update. Gold and PSEC

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

Ok I admit in this video I am talking too softly.

PSEC is going to make a big impact on the Active Accounts monthly income. The question is WHEN do I buy it. I might be able to wait and get a 10% better price looking at the 2012 low. I also have that SPY Put and my thought is we are getting a market pullback.

However, when a company is undervalued is the market going to pull it down? PSEC is already paying a 12% yield, one of if not the highest currently for BDCs. Oh and then there is the fact that their 2012 NII is +50% more then 2011 yet share price has risen only 20%.

The question comes down to... is PSEC something I want to nitpick and risk 10% gain in shareprice and possibly miss out on?



Investing and Trading Account: $7,080.41
Total Return: -3.01%
Est Monthly Income: $12.41

Trading: $3,419.85
Total Return: -6.27%
Stock
     NOK: -8.7%
Options
     SPY 152 May PUT: -30.37%
Cash: $2,834.46

Investing: $3,622.64
Total Return: 0.34%
Stock
     AFL: -5.44%
     HAS: +11.77%
     SPLS: +10.49%
     STX: +4.53%
     PSEC: To be purchased this week
Energy
     WHZ: -11.75%
Gold
     IAU: Sold. Waiting for price action to level off.
Bonds
     BLV: -2.08%
     JNK: -0.85%
     PCY: -3.40%
Cash: $1,282.52

ETF Account: $7,238.15
Total Return: -0.85%
Est Monthly Income: $14.15
US Stock
     SPY: +2.40%
     XLV: +2.87%
     VNQ: +2.09%
International Stock
     EWZ: -3.55%
     PXR: -4.00%
Gold
     IAU: Sold. Waiting for price action to level off.
Bonds
     BLV: -2.00%
     JNK: -1.21%
     PCY: -3.27%
Cash
     Cash: $2,874.96

Permanent Portfolio: $7230.45
Total Return: -0.95%
Est Monthly Withdraw Rate (4% rule): $21.95
Listed by weighting
     SPY: 25.21%
     GLD: 23.27%
     TLT: 24.28%
     Cash: 27.24%



Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

Know your investments

You hear the term due diligence a lot with researching stock. Just how important is it...

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

Looking at the past performance of MAIN vs TCAP it would appear Main Street Capital has given more total returns so what's my complaint? Past performance is no guarantee of future returns. The price that the market has assigned to MAIN is separate from how management runs the company. If a few of their loans go bad now MAIN has to cut the dividend or sell even more assets. Whereas with TCAP if some of their loans go bad they can always resort to selling assets for a short term fix while they replace those loans.

Now I am not saying Main Street Capital is a bad company. They aren't doing anything illegal in hiding definitions because it is in their public filings and it continues to be on my investing watch list (3 tab of the spreadsheet). I think management is good overall and I will wait to see if the net interest income covers the dividend.


Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

New Investment: Triangle Capital (TCAP)

The order for the investing account through and the Model Portfolio owns its first Business Development Company...

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

In the video I explain TCAP's strengths but I didn't go into what it adds to the portfolio. At 16:42 in length I think it was long enough but being a Business Development Company (BDC) they can get a bit complex and it was necessary to cover this type of company.

TCAP is the first BDC of the Model Portfolio so its going to add in diversity of tiny equity sector. Since they invest in dozens of tiny companies we can think of TCAP as a no load, no management fee, nano-cap mutual fund. Nano-cap being a company of less then $50m while Micro-cap is $50m-$300m. Its a good way to gain access to that level of company and thusly the economy without being in a true mutual fund.

The 9.72% yield sure doesn't hurt either! That makes it the highest paying position in the portfolio edging out ERF. With a high yield it must give poor dividend growth right? Nope it has a 5 year 7.1% annual growth of the dividend. This means both the portfolio's average yield and average dividend growth grew with this investment.

That high yield comes with a risk. Although TCAP has only 9% of the investing account's money it accounts for over 20% of the income. If I was trying to live off this and only had these positions I would be in trouble if TCAP cut or eliminated its dividend. By the end of Phase 2 of the investing account I'll have 25 positions so long term this is not a risk and since I am not needing to live off of it until long term then there is no risk to endangering my income.

Graphs provided by Fastgraphs.com

Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.