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No. of Recommendations: 2
Preferred stocks are kinda, sorta a bond whose characteristics can be looked up. For the most part, they're hugely illiquid, pretty junky in terms of credit-worthiness, and more subject to 'call-risk' than "real" bonds. But their yields might be attractive to you, and in the past couple of days, I bought a basket of 60 of them. So this is simply my experience so far, not a recommendation that you should get involved with the asset-class.

I didn't do an exhaustive comparison between the usual suspects. But Schwab's scanner seemed the easiest to use. So that's where I executed. What I am comfortable saying is that using market orders got decent fills. Sometimes, I'd split the spread. But if the spread was tight, I wouldn't bother with trying to save a penny or two. I'd write a market order and move on. But here's what's ironic. Several times, when the spread was something obvious like 20x30 and the split would be 25, I'd use a limit order and NOT get a fill. But when I changed to 'market', the split was what I got or --sometimes-- a penny less. But generally, market orders were executed at about 2/3rds the spread, which is decent enough, given that I was in a hurry.

At TMF, the sales reps like to bash technical analysis, because charts are an easy way to show that TMF's "recommended" stocks aren't timely. In fact, by the time TMF gets around to recommending a stock, it's likely to have become a short. At TMF, 'funnymental analysis' is supposedly the basis of their stock-picking. But if you read their reports and double-check their work, you'll discover how bad most of those reports are. So, what to do? IMHO, unless you're turning stocks around in a couple of minutes, fundamentals do matter, and you gain a margin of safety by understanding what it is you're betting on. The upside of TA is that a good-enough chart can be built in seconds. But grinding through 10Qs to discover whether the company is healthy isn't a fast process, and if you're trying to vet hundreds of stocks, it's an impossible task. You need shortcuts. (Everyone will have their own preferences. So there's no need to mention mine.)

What I found was this. As an asset-class, preferreds are as over-bought as anything else, and looking at a chart was almost no help at all. What did matter --at least to me-- was two things: the financial health of the issuer and whether I could get in at a tolerable price. When the market crashes and discounts become available, I'll increase position sizes. But for now, I was buying fast and small.

Arindam
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