Investing 102

[GregWeld]

Originally Posted by ErikLS2

Mostly for you Greg since you know NLY pretty good. I've been away for a while but going to re-do my whole stake along the lines of what's discussed here. I was just poking around today and found this:

http://seekingalpha.com/article/1067...ce=marketwatch

I'm wondering if you know anything about this company or have any comments on this article?

I read the SeekingAlpha article and the writer makes many compelling points about EFC. I just trade NLY because it's a good name that I know and I can trust it. I park pretty large sums in some of this stuff -- and I have to be able to sleep well at night. Thus my "Buy names you know and trust" which I try to hammer home every chance I get.

There are ALWAYS better names -- or better peer performance. But can you sleep with them? What costs people money is that they panic at the first downturn or hiccup - and this panic is exaggerated when they put money into something they don't know anything about.

There is NOTHING wrong with learning about any or all of these company's and if you (you being the larger - any of you) feel this is a place you want to put money and like all the metrics etc over some other investment... then that's the best you can do. It's the best ANY of us can do. Many times - while researching a new name - you find out things about the company you might already be in! They'll all compare "their" company against the peer names. Sometimes you learn good stuff - sometimes you start to question the name you're in and go back and dig deeper... and I'm 200% for this type of self education! That is what we all should be doing and need to continue to do. Jim Cramer calls it HOMEWORK.

My son looked over my shoulder just a minute ago and said "dude - you've been doing that all day". True enough.... I'm always looking at this stuff - comparing - charting... reading. I love it as much as I do car stuff. My response to him was "yep - that's why I'm good at it".

[GregWeld]

By the way -- I'd have made more money using EFC than I have in NLY over the last 6 months or so!

Thanks for bringing up this name --- I'll do more poking around and put it on my "key an eye on it" list!

[GregWeld]

It will be very interesting to see the market reaction to the proposed (since the House hasn't voted yet) changes to the tax laws.

Dividend tax rates increase from 15% (far too low IMHO) to 20%... which is still too low.

We can argue on and on -- but it's this guys opinion that the tax rates are too low on top earners -- BUT -- BIG BUTT -- what top earners really understand and would like to see change is the WASTE that government does with the money they already were getting. That's a different discussion and let's not get into it.

My guess is if you're not in the market on Wednesday morning --- you're going to miss a very nice move UP. But that's just my guess. I'm thinking there's lots of money sitting on the sidelines avoiding a possible disastrous raise in the dividend tax rate... and since that appears to be set - that sidelined money should come pouring back into equities. I know that's what I intend to do. I'll scale back in but... I'll still be a net buyer. Around 40% of the one Schwab account I use for discussions here - is in "parked" cash.

[John510]

Im just happy they voted to not double to price of milk!

[WSSix]

Score!!!!!!!!!!!

You can contribute $5500 per year to a Roth IRA now. That was a pleasant surprise. So my max has been reached for this year already. Next week I should be able to purchase the stocks. I just hope they wait til I'm on board before they take off like a rocket ship. Hey, I can engage wishful thinking, right?

[CRCRFT78]

I just received this letter from Fidelity:

12/31/12 14:07:16
CATERPILLAR INC. IS OFFERING TO PURCHASE ALL SHARES OF ITS COMMON STOCK FROM SHAREHOLDERS OWNING LESS THAN 100 SHARES (99 SHARES OR LESS) AS OF RECORD DATE NOVEMBER 26, 2012. SHAREHOLDERS WILL RECEIVE THE WEIGHTED AVERAGE MARKET PRICE PER SHARE TENDERED, THE DAY THE SHARES ARE SOLD BY THE AGENT. A PROCESSING FEE OF $2.00 PER SHARE UP TO A MAXIMUM OF $50.00 PER ACCOUNT WILL BE DEDUCTED TO DEFRAY THE COST OF THE PROGRAM.

HOLDERS ALSO HAVE THE OPTION OF ROUNDING UP THEIR HOLDINGS TO EXACTLY 100 SHARES. HOLDERS ELECTING THE ROUND-UP OPTION WILL BE CHARGED THE ESTIMATED PURCHASE PRICE OF $95.00 PER SHARE PURCHASED. A PROCESSING FEEOF $2.00 PER SHARE PURCHASED (UP TO A MAXIMUM OF $50.00 PER ACCOUNT) WILL BE DEDUCTED TO DEFRAY THE COST OF THE PROGRAM.

I'm wondering, if I don't want to sell but I can't afford to round up to 100 shares does this matter? I thought I'd ask here before I call them in the morning.

[CRCRFT78]

Waking up to a nice jump in the market, today is starting to look like a good day.

[GregWeld]

I can't find any news on CAT taking an action like this... And I would NEVER respond to an email sent from any financial institution. Only way I respond to a financial institution to to use my OWN links (not those in an email) and or call them using the phone numbers I have (not those in an email).

I also have no idea what - if anything - you should do - since I don't understand the "offering".

From time to time I'll have a "Call" on some senior subordinated notes etc get called away - meaning that the company has the right to pay them back early at a pre agreed price. This just happened to symbol GE-A... General Electric 6.5% notes... they did a partial call. But I've not ever had a situation where they were just taking me out of a STOCK.

Originally Posted by CRCRFT78

I just received this letter from Fidelity:

12/31/12 14:07:16
CATERPILLAR INC. IS OFFERING TO PURCHASE ALL SHARES OF ITS COMMON STOCK FROM SHAREHOLDERS OWNING LESS THAN 100 SHARES (99 SHARES OR LESS) AS OF RECORD DATE NOVEMBER 26, 2012. SHAREHOLDERS WILL RECEIVE THE WEIGHTED AVERAGE MARKET PRICE PER SHARE TENDERED, THE DAY THE SHARES ARE SOLD BY THE AGENT. A PROCESSING FEE OF $2.00 PER SHARE UP TO A MAXIMUM OF $50.00 PER ACCOUNT WILL BE DEDUCTED TO DEFRAY THE COST OF THE PROGRAM.

HOLDERS ALSO HAVE THE OPTION OF ROUNDING UP THEIR HOLDINGS TO EXACTLY 100 SHARES. HOLDERS ELECTING THE ROUND-UP OPTION WILL BE CHARGED THE ESTIMATED PURCHASE PRICE OF $95.00 PER SHARE PURCHASED. A PROCESSING FEEOF $2.00 PER SHARE PURCHASED (UP TO A MAXIMUM OF $50.00 PER ACCOUNT) WILL BE DEDUCTED TO DEFRAY THE COST OF THE PROGRAM.

I'm wondering, if I don't want to sell but I can't afford to round up to 100 shares does this matter? I thought I'd ask here before I call them in the morning.

[GregWeld]

Jose,



My guess is - there's too much bookkeeping and they (CAT) just want to take out small batch holders so they don't have to cut dividend checks and mail notices out etc.