Replies to post #12891 on Fannie Mae Preferred S (FNMAS)

[georgenips]

bingo

[rosen62]

i have not heard anyone here saying that prefs could be worth more than RV.

Why? You mean potential dividends at a 7% or 8% clip (T) yearly do not compound? So you buy the Jrs. at 50/60 cents average (I did), reach face value and then payouts kick in (let's dream since there's a dream out for commons appreciation). In the long run/race, this mix is unbeatable as far as returns go. And what counts are returns! Even if commons start at 30/40 cents and ever reach $30 a piece (fully diluted). I assume possible dividends for common may end up being a lot lower. And this calculation is pre-5th-lawsuits and pre-Berkowitz-offer. It's been there all along.

Now, with the new landscape, it gets even better! As you just explained.