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What makes anything valuable is supply and demand. If everyone collected things the supply wouldn't be low enough to generate enough demand for high value. The trick is to get something that will be both rare and sought after. Since that's not possible to predict, I don't collect for an investment but a passion. If I get rich from it, that's a bonus. People didn't collect comics in the 40's and 50's which is why a Superman #1 is so rare.
The bike in my profile is extremely rare. Only several hundred were made, but not many people want them so they're not expensive. But if all of a sudden people start seeking them, I'm sitting on a gold mine... Literally.
It's hard to find accurate numbers on collectibles. Whether you're talking about stamps, coins, art, classic cars etc, industry groups add an overly rosy spin. That's their job.
The oddest thing is how NO ONE collects ANYTHING anymore. When I was young, every kid collected stamps, coins and baseball cards. Then sports cards came back... and died again. Coin collecting survived mainly due to bullion interest. Silver and gold coins will always have buyers. Do you know any teen who collects anything?
The HOBBY of stock investing is in decline to a remarkable degree. Ratings for financial TV programs are way down from a decade ago. Stock clubs are becoming extinct after peaking in the late 90s. I've heard that Google searches related to stocks have fallen. No doubt the crashes in 2000 and 2008 soured many on stocks. And all the Dot Com era scams. Many have realized they can't outsmart Mister Market.
Stock investing, at least the hobby component in it, is definitely in decline. Your broker won't tell you about that, but it's true.
Of course a fat 18% dividend, if sustainable, will always generate interest. LOL!
Comics, like any collectible vary depending upon the buyer. I have some highly desired issues like wolverines first appearance and #1's. But they're not an investment per sey, more of a hobby I can sell if need be.
My military retirement is my best investment. Guaranteed paycheck and free medical benefits for life for 24 years of work. Seems like a decent deal so I stuck with it.
"Can't leave out my comic collection either which is worth about $100k" How's the market for them?
I'm not a fan ultra-diversification. There's one active poster on Seeking Alpha who has 200 stocks which I and most others think is crazy. Besides, we've repeatedly seen how stocks, even international stocks, move in lockstep.
I only own about 14 individual stocks. But I own a few mutual funds and ETFs. When I advised people to buy index funds 30 years ago they thought I was nuts.... "Guaranteed Mediocrity" was the usual argument against them.
But they've beaten my mutual funds and just about everything else year after year. Most investors will buy/sell individual stocks at the worst possible times but they'll often hold onto index funds.
--
I've researched mREITs, like WMC, back 60 years. They're a fabulous moneymaker... for management!
I have most of my money in real estate, index funds, and the rest in stocks from blue chip to OTC. Can't leave out my comic collection either which is worth about $100k, but I'd probably never sell them:)
Doubt we diversify in the same way. I do it by owning blue chips, muni bonds and CDs in insured banks, plus some real estate. The average IHUBer thinks he diversified because he owns 50 stocks... all low grade.
Still properly diversifying is really hard to do these days. GL
That's why you diversify.
Repost from another stock but it certainly applies to WMC and most mREITs:
"OTOH, I see tons of mindless yield chasing especially by retirees. One woman -- whose husband had just died -- put her entire portfolio in mREITs, BDCs and oil MLPs yielding double digits. That was around 2012. If it paid 18%, she owned it!!! I figure she's lost >60% of her principal... in a generally rising stock market."
Still 17% at today's stock price. Not too shabby. I will worry when the divi goes under 10%. But considering recent reaction to Yellen's statements, looks like this year will hold steady or increase to around $12 which will, in turn, give us dividend increases back above $.50.
Thanks for the in-depth analysis.
it will pick up later this yr
"Western Asset Mortgage Slashes Its Dividend"
"Western Asset Mortgage Capital Corporation (NYSE:WMC) just cut its dividend from $.58 to $.45 per share. The substantial decrease shouldn't be a complete surprise. I called out the dividend as being significantly unsustainable "
http://seekingalpha.com/article/3960939-western-asset-mortgage-slashes-dividend
Right > div up just little possible
Shouldn't we be hearing about the next divi by now?
Lets hope for the best to come
Ouch! Horrible overreaction to today's PR on things we already knew...
could go higher too
Resistance is thin til $12
that would be good = Div increase too possible
I expect to see an increase in earnings and dividend this quarter based off of the GSE ERs and the recent insider buying we've seen for WMC.
Possibly a dividend back up to $.60 or more and the stock price will go above $11 following the ER.
JMHO
Western Asset Mortgage Capital Corporation To Report Fourth Quarter And Year End 2015 Financial Results
Good movement here lately. Hope the uptrend continues.
Yea, now if the stock can get back above $15, this will be golden.
will do good in 2016 too
Insider buying lately. Good sign.
Special Div would be great
Nice movement lately. Hopefully this will be above $14 in the next few months. The rate raise is pushing it up finally. Hope to start seeing some dividend increases too. Would be nice to see a fat $2 divi Q4 FY16.
I also expect dividend cuts until the Fed raises the rates. It all hinges on that IMO.
The only available BV figures are 5+ weeks old, and even then, they aren't audited. Again, I emphasize that mREITs are highly leveraged so numbers are outdated almost instantly. By any measure, WMC is doing poorly and may well cut its dividend in the next few months.
From http://www.westernassetmcc.com/
•$13.26 per share net book value as of September 30, 20153 versus $13.89 as of June 30, 2015" BV was over $15 a few months before that.
still do good
Try reading the 8-K instead. Book value per share is $13 and change which is above current levels.
Once the Fed raises interest rates, this will turn bullish instantly. Rates were expected to have been raised already which is dragging everything down.
"WMC reports unexpected 3rd Q loss."
"The results did not meet Wall Street expectations. The average estimate of six analysts surveyed by Zacks Investment Research was for earnings of 64 cents per share."
"Western Asset Mortgage shares have fallen 19 percent since the beginning of the year. The stock has fallen 21 percent in the last 12 months."
https://finance.yahoo.com/news/western-asset-mortgage-reports-3q-122126348.html
There's no $9 floor when you realize how leveraged this mREIT is... about 7 times. It's not one of the worst but these can perform terribly under certain conditions. Some mREITs have failed. Poof! Zero!
" I think the lowest it will go is $9, in which case, I'll back up the truck."
I've only seen two or three IHUBers over the years who understand mREITs. Point it, those fat divs come with huge risks.
Yes, I know. I did not say it owned anything. It's just like the GSE's. What exactly is your agenda anyway? Go away if you don't want to invest in it. I don't need unwanted financial advice from strangers on message boards.
You don't even know what WMC does! It owns mortgage backed securities. It owns NO REAL ESTATE.
"WMC is in real estate with solid properties so I'm not concerned about much downside. I think the lowest it will go is $9, in which case, I'll back up the truck."
I saw that article when I was researching WMC to buy. There were about half negative and half positive analyses. WMC is in real estate with solid properties so I'm not concerned about much downside. I think the lowest it will go is $9, in which case, I'll back up the truck.
"MortgageREITs: Shockingly High Price for High Dividends"
"A historical look at mREITs
Mark Twain once said, "History does not repeat itself, but it does rhyme."
Mortgage REIT investors need to know how difficult it really is to buy, and hold, an mREIT over a long period of time.
Suppose you invested $1,000 in mREITs when they first came to market in 1970. What would your investment be worth today?
You're not sure? Guess. Just throw out a number.
When I tell you the answer, you're probably going to be in disbelief. I was.
The answer is $56.90. Yes"
http://www.fool.com/investing/general/2014/01/25/mortgage-reits-the-shockingly-high-price-for-high.aspx
That was a good article. I'm not basing my retirement off it and expect the sp to rise next year when rates rise. This has been going down bc of low rates IMO. They are a solid company with good earnings. I'm ok.
WMC is off about 19% since your first purchase on April 10. During that period the broad market has slightly risen.
Averaging down with mREITs is very risky since many have gone out of business during the sector's 50 year history. Their main business is making bets on the direction of interest rates and TRYing to hedge some of the risk. I know little about WMC's structure but I'm quite familiar with other mREITs.
When things get bad, some mREITs will do highly dilutive rights offerings.
I'd urge you to study the history of the mREIt sector. But WMC's poor performance over the past 6 months should tell you to be leery.
These are gimmicks mostly for unsophisticated retirees desperate for income to live on. Brokers love mREITs because they're easy to sell. But you don't see Buffett or sophisticated investors buying them.
mREITs are incredibly complex. On top of that, most are riciculously leveraged so things can change in an eyelash.
Now READ this article at least two or three times.
http://seekingalpha.com/article/3534636-pondering-western-asset-mortgages-cut
With this company's earnings? Are you kidding?
very good investment here
I've got 2400 sh now and will keep adding when I can. Set up DRIP as well. Put some in an IRA and a custodian acct for my daughter. Don't see any downside here.
I must agree with you ~ wish I have more shares
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