Early Retirement Extreme Forums

Pulled the trigger on more NLY.

Sold LINE, BBEP and NRP.

Wow, I haven't posted on here in a while.

I bought more DLR a little over a week ago for $54.75 per share.

I bought shares in MO yesterday for $34.52 per share.

I also like XOM and IBM at current prices.

*IF* I did the math right, MORL's yield is north of 30% (even after yesterday's run up). I'm kinda sorry I didn't buy any Monday.

$28k in MORL and the dividends would cover Jacob's (and many other forumites') annual expenses. Talk about a really, really extreme early retirement.

(For six months until the dividends go down, that is.)

Well... if you had the traditional $150k account for a "jacob" plus an additional $28k for a safety margin, you might be tempted. On the other hand, $28k represents 4 years of living expenses without touching the $150k that's compounding. Do you feel lucky, punk?

I think we've created a new passive income unit; from now on, I'm planning all of my retirement income in jacobs.

How are you coming up with a 30% yield on MORL? The low on Monday was $16.12, and the dividend over the last year was $1.46; what am I missing?

@susswein--The distribution varies each month on MORL. I can't find the paper where I added up the number (too many scraps of math on my desk) but here is UBS's calculation. They list it this morning at 31.20%.
http://etracs.ubs.com/product/detail/in ... ymbol/MORL

No doubt it's a gamble. Interesting though. At $16.12, I think it would have been worth some of my trading fund.

I must admit, I'm not extremely well versed on REIT's. Other than the obvious reasons (rising interest rates, Fed cutting back on stimulus, etc.), why are MORL (I know it's leveraged) and others being hit so hard?

It's mostly the rising interest rates, which investors expect will lower the mREITs' book values. Funny story: when the Fed announced QE3, mREITs went down. Now they're going down again as the Fed hints that they'll slow down QE3. Volatile asset class indeed.

Ok, so nothing weird then.

I believe MORL is also 2x leveraged.

It is, but I don't consider that weird. I understand leverage fine. It's the other esoteric qualities of these instruments that always worries me, as I'm not even sure the creators always know what they have created.

MORL is up over 10% since Monday. I watched it all day Monday, but I was distracted by something else and I was afraid to pull the trigger when I was so distracted.

Dang, I hate missing out on the easy ones.

I thought about jumping into MORL after you mentioned it--of course now I wish I had. I'm sure it'll go back down at some point next week on another tapering panic.

So the MORL of the story is ?

secretwealth wrote:I thought about jumping into MORL after you mentioned it--of course now I wish I had. I'm sure it'll go back down at some point next week on another tapering panic.

Yeah, this market is probably going to be all over the place for a while, so there should be another opportunity at this week's price. But, even after the 10% run-up its still not exactly expensive. I will probably add MORL, BP, and DVYE to my portfolio over the next week or two. I like BP and DVYE for long-term.

*IF* you add MORL, wait for a day where it dips by a bigger % than its component parts. Last Monday, It was down 2% more than the big mREITS were (AGNC, NLY, TWO, etc). Also note, it's an ETN, not ETF.

I don't want to get run out of ERE-town on a rail if it tanks

Don't worry, jp--if it tanks after I buy I'll just complain to the SEC and get your Series 7 revoked.

SW, I can't believe you would do that to me. I've never been anything but a sweetheart to you.