foolish learner
04 Mar 2015
Re: sold out and signed off Thanks, will have a look at bot
FRTEB
04 Mar 2015
Re: sold out and signed off New City High Yield Fund (NCYF)[link] link takes you straight to the discussion, which you may find interesting...Also, although ii provide a factsheet (linked to from above discussion page) I find the HL site more user friendly: [link]
foolish learner
04 Mar 2015
Re: sold out and signed off for FRTEBWhat is the full name for NCHY as it does not show on the search bar of iii or DG LookLike you I have enough to do in watching my shares and i also look after a small portfolio for the wife. No doubt I will get that wrong like everything else a male touches so for safety i have taken a spread of investment trust type holdings (except for some Lloyds preference shares which have shot up of late). Despite management charges they are paying about 5% dividends that will (hopefully) rise over timeI think its HDIV, (may be another Henderson) that specialises in the money market but i am sure there are ot
FRTEB
23 Feb 2015
Re: sold out and signed off Guitarsolo, thanks very much for that. Much food for thought. I must confess, I am still leaning towards something like the New City High Yield investment trust. Why? Well, it would be less hassle to monitor/manage one IT (for now) than several pref shares (in addition to my growing portfolio of ordinary shares). NCHY is currently offering a ~ 6.7% yield, with no hassle/time required to research individual bonds or preference shares. This would leave me to focus on the pure equity (ordinary shares) side of things. The management charge of NCHY doesn't appeal, but with the yield I think I could live with it.Having said all that, I will also look at AV.B, SAN.B and STAC (thanks for the pointers). I might in the end decide I can't live with the management charges after all...Thanks againBill
Guitarsolo
23 Feb 2015
Re: sold out and signed off Hi FRTEB, OK, before I begin I am no financial adviser and am entirely self-taught! Preference shares do what they say on the tin. They are "preferred" meaning that a company must pay the dividend on them (known as the coupon) ahead of dividends to the ordinary shareholders. The coupon is fixed like an interest rate (e.g. you'll see Aviva Pref B shares are 8.375%). The coupon can't go up, or down! The shares typically have a value of £1.00 when issued, so for the AV.B shares above that would mean you get 8.375p for each share you hold. The shares are traded though and so they can rise or fall in value. AV.B is presently trading at around £1.35 so that actually means you will get a yield of 6.20% (8.375/1.35). Some pref shares have a maturity date (.e.g. 2025) meaning the shares will be redeemed at face value (£1) on that date. The share price should trend towards £1 the nearer the date you get. Others are open-ended and so will just be valued according to demand for the income. However, remember that the coupon can't increase so, as inflation eats away at its value, the value of the share should decrease. But that also means they are good in a low-inflation environment. Watch out for some bank shares as the banks have "forcibly" converted the pref shares to ordinary shares or other less favourable debt. I don't know how legal this is/was but at the height of the banking crisis it was more a case of "so what, what are you going to do about it?". The pref shares can be quite a drain on the issuer as they have to be paid first. It they don't pay them, they should accumulate and must still be paid ahead of ordinary divis. Watch out for one particular one that I hold, Santander B (SAN.B) which pays a coupon of 10.375%. This is the gross rate and, like ordinary divi tax, you have to deduct 10% at source. So the coupon really should be 9.3375%. You then need to divide that rate by the price to get the true yield. I don't know what Santander is different to the others, just be aware!When I started building my portfolio (actually it is for my mum!) I wanted income and certain pref shares were cheap (e.g. I bought AV.B at £1.10). Aware that the coupon was higher than most ordinary dividends but couldn't go up, my view was that a modest amount of pref shares would give the portfolio an income boost in the early years which would reduce over time (as the coupon can't go up like ordinary divis). .However, we have since moved into a deflationary environment and threat to other high yields. So it has transpired to be quite opportune. Plus the share prices have risen, which is a shame as it puts me off buying more! I hold AV.B, SAN.B and STAC. They all pay the coupon in equal amounts twice yearly which I have found useful. Right now, you can still earn circa 6% on a number of decent companies (particularly insurance companies). A good source is: [link] I am not sure anything is good value at the moment (across everything really, including pref shares) but it may be worth having a look and then putting some on a watch list to buy at a price you're happy with. Good luck!Guitarsolo
FRTEB
21 Feb 2015
Re: sold out and signed off " Does anyone else follow any pref shares that might be worth a look with respect to locking in a decent income. " ---------- ---- I don't follow preference shares, but that's mainly because I don't know much, if anything, about them. Please feel free to educate me! However, I have the New City High Yield investment trust on my watchlist: [link] and [link] ...I haven't invested for the above same reason = need to learn more (about preference shares, bonds, and investment trusts!) New City... holds preference shares and corporate bonds, etc. I keep thinking I need something like this to balance my portfolio, rather than holding pure equities and cash. Comments, thoughts appreciated.
Guitarsolo
20 Feb 2015
Re: sold out and signed off Thanks GI, Given the current environment for many high-yielders looks precarious, I have been keeping an eye on certain preference shares with a view to having something where the coupon can't go down (or up). At the outset of my portfolio I put about 15% into preference shares (AV.B, SAN.B, STAC) all of which proved to be very worthwhile at the time - yielding approx. 7.2%, 8.5% and 6.7% respectively at the time if I remember correctly. However, the prices have risen too much for me now that I don't see enough value there to add more. Does anyone else follow any pref shares that might be worth a look with respect to locking in a decent income. GS
gamesinvestor
20 Feb 2015
Re: sold out and signed off Guitarsolo,It's difficult to chase high yield, as Centrica illustrated yesterday. There are catches with most overly high yielding stocks and the same fate could await many of the other utility, oil and commodities companies. When your core products halve in price it's difficult to justify.There is significant value in non high yielders.eBay is interesting as they will spin off Paypal this year and the estimates are that PayPal standalone is worth more than the current market cap of eBay. Ironically Centrica is also not a bad bet now that the share price has been trashed. The new CEO has kitchen sinked it and it could look good next year and is sitting on a 4.8% yield even after the 30% cut.Royal Mail group isn't too bad now that it has no pension liabilities (the guvmint gave all that liability to you and me to sweeten the float) and pays a reasonable yield. Tate looks sweet for a take over on 5% yield. Games
Guitarsolo
19 Feb 2015
Re: sold out and signed off Hi Grey, price is down as it went ex-divi today (33.5c so about 22p). I too have spent a while searching for a decent yield. It's way off base from the non-life insurance business but I did buy a few MLIN who manufacture products and machinery for the tobacco industry (their founder invented the original Marlboro flip-up lid!). It is yielding over 6% and is well covered. But is not a bed of roses as the price fell significantly last autumn due to order delays - perhaps not quite a profits warning but it was treated as such by the market. Probably hence why the yield is so good now. Personally I took the view that it was worth the risk. Does anyone else have any high yielder tips to share?Guitarsolo
Greyinvestor
19 Feb 2015
Re: sold out and signed off I only looked back at this board because I wondered if the bid might be off; I wondered why the price was down.I'm a frustrated investor. I'm now out of CGL and BRIT (to which I had allocated much of my CGL cash). OK, it's been profitable, but what I am desperate for is a decent income. I still have chunks of AML, LRE and NVA, but I think their prices are getting very heady.I've looked all over. Bought a few PFL and yes, had a good look at CLIG. In the end I didn't take the plunge because the P/E is reasonably high. I'm still vacillating. I'm holding a very high percentage of cash until I can find what I want. There is some decent stuff in France and in New Zealand, but I am concerned about the currency risk.So I'm now off on hols and will read and research endlessly until I find what I want.........
Guitarsolo
18 Feb 2015
Re: sold out and signed off Hi Healzo, I too am looking for a home for the 1/3 of my CGL holding which I disposed of yesterday at 707 (the rest has to wait until after 5 April or I decide to take the XL offer in full). I too hold a modest amount of CLIG which I got into at around 240p. It had a 10% yield (now fallen to about 6.5%) at the time but I am concerned about the low level of cover. It scraped into my "10%" rule by the side door really (I look for yield x cover to be at least 10%) - CLIG was 10% x 1.0! I would buy more if the price dropped a little, perhaps 320p, as like you I think they are well run and should grow FuM and earnings accordingly. But there is a real dearth of solid, dependable high yielders out there with all of the non-life stocks being taken out with takeovers. I still hold AML but don't want to lose that either unless it is for £7 a share or better!Guitarsolo - strumming away.
healzo
17 Feb 2015
Re: sold out and signed off Grey Investor,A shame about CGL, but more so Brit! Very frustrating, although I shouldn''t complain too much with a purchase price average at £2.33 and one dividend.Might I suggest looking at CLIG? I've been invested since 2010. Share price has taken knocks in that time, but they're a very well run / transparent company with their directors, Barry Olliff in particular, heavily invested. Has a good yield / dividend which has been maintained despite headwinds and fluctuating sentiment. They're now confidently looking forward to new FUM and dividend growth. Current yield 6% ex-divi tomorrow. H
gamesinvestor
10 Feb 2015
22p Final Divi - up 5% ish Full year profits from Catlin were slightly behind analyst forecasts, though the speciality property and casualty insurer delivered higher net asset value (NAV) than expected, with its takeover by US rival XL expected to be effective later in the year.Profit before tax climbed 13% to $488m, behind the consensus estimate of $492m, but helped by the sale of Box Innovation Group (BIG) which lifted the investment return by around $31m.Basic earnings per share was up 5.4% to $1.17 and the total dividend was lifted 5% to 32.5p with an expected 12p from the sale of BIG.Net tangible assets per share increased during 2014 by 8% to $7.73, while book value per share rose by 6% to $9.47.The return on net tangible assets was down to 16.3% from 17.0% the year before, while return on equity down to 13.1% from 13.4%.Catlin's combined operating ratio was up slightly at 86.8%, reflecting a more benign year for insured catastrophe losses, down to $85m from $156m but included larger risk losses of $107m from events such as the Malaysian airline losses and the Tripoli airport losses.Chairman John Barton said: "While I am pleased with Catlin's performance in 2014, I also believe that the offer to acquire Catlin by XL Group plc would result in a business combination that will become a leader in the global property/casualty insurance industry and result in the realisation of significant value for our shareholders."Broker Shore Capital said the strong finish to the year "leaving us to wonder ‘what if’ in terms of possible return of capital".Catlin has nevertheless agreed to a take-out by XL at 388p cash, a 22p final dividend and 0.13 XL shares for each Catlin share. Analyst Eamonn Flanagan noted that at current prices, with XL around $35.7 and the sterling-dollar rate at 1.53, this equates to circa 713p per share, with the bid expected to be effective mid-2015
Guitarsolo
06 Feb 2015
Re: Completion date Thanks Sinnet/ Whatupnow,All being well I can use some of my CGT allowance for next year if the deal is completed in Q2. Sinnet, yes I could elect for more XL shares and defer the capital gain until whenever I sold them. But I have a natural aversion to Uncle Sam being able to stick his nose into my affairs and so would prefer not to hold US registered stock - even if it is a worthwhile investment! As it happens, I provide loss adjusting services to both Catlin and XL and rate both as excellent companies. However, XL's dividend is not sufficient for my income-focused plan and so I would prefer to look elsewhere for a better yield......but obviously won't do so if it means being slapped with a CGT bill just for the sake of it! In that sense it is a bit of a blow to me to lose Catlin as I primarily wanted the income (but am not knocking the 40% capital gain as well). Where to look now for a non-life insurer high yield? I already have enough LRE and AML. DLG has risen near 60% since I bought about a year ago and so is no longer so attractive. ESUR has the yield but not the cover. The search continues!Guitarsolo
sinnet
05 Feb 2015
Re: Completion date "Guitarsolo - wondering how to not get stung with a CGT bill!"Well you could always try electing for a higher proportion of XL shares rather than cash. CGT will only arise on that portion of the takeover proceeds when you sell them. My CGL are in ISAs so I'm lucky on that score.
