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Post by chang on Dec 28, 2022 21:12:04 GMT
Pimco CEFs PDI, PDO, and PAXS hit (and closed at/near) all-time lows today. PTY hit its lowest since July 2009.
I'm waiting for >10% discounts before I buy. I might not see them: PDI's max discount was -11.42% (6/12/13), PTY's was -15.25% (10/10/08).
I know many investors consider these to be "money printing" vehicles, but the charts don't look so inviting to me.
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Post by uncleharley on Dec 28, 2022 22:06:08 GMT
Their recent declines on strong volume give me pause, but I will hold until the New Year has arrived. IOW I think the recent drops in price is weak hands selling during the holidays. JMHO. They will have to test the lows of 2020 to give you your 10% discount. That could happen, but I do not see that yet.
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Post by steelpony10 on Dec 28, 2022 23:22:07 GMT
uncleharley , I’ll guess it’s the shake out of the newbie’s along with short term volatility based on headlines not earnings, yet another rally/crash. These are near my discounts when I traded tanked dividend stocks for worst tanked CEF’s in 2009-2010. I looked at them as cash machines (only) as mentioned. I received all my money back by say 2019 (<7 years if reinvested, 72/10) so it’s free money from now on. I chose this instead of trying to trade for 8-10% gains each year against unknown value movements which are stalled right now for an unknown length of time.
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Post by Fearchar on Dec 29, 2022 2:31:50 GMT
Cost of leverage is rather high right now.
I wonder how much longer they will be able to continue the current distributions as I can not figure it out.
Of course someday leverage will become cheaper than it is now, but when?
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Post by steelpony10 on Dec 29, 2022 12:06:52 GMT
Fearchar , CEF’s have been around since the late 1880’s I believe about 50 years before OEF’s. There’s a great deal of institutional experience passed along just like long lasting well managed individual companies and later OEF’s. Good management gets more consistent results PIMCO being the tops in that field to date. Of course you should expect distributions to vary year to year but the key feature for me is ours so far have distributed way above our personal inflation rate. Just don’t chase yield which is a beginners mistake probably all new investors make. One can get discouraged if you switch your focus to greed. Whether 5% or 10% along with SS COLA raises we’re good so far.
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Deleted
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Post by Deleted on Dec 29, 2022 13:46:04 GMT
PIMCO's leverage is the use of swaps or reverse repos (not what retail investors use as leverage), and they make money from them as do the banks). There are a number of articles explaining what they do, just google them.
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Post by shridog on Dec 29, 2022 16:08:22 GMT
What the managers of PIMCO CEFs need is a trend. They have it now. Capecod Dick was the best at explaining these bond CEFs. One key to look at is increase/decrease in NAV over a month versus the distribution. Black box for sure and no doubt a TR beating has been had this year, but income is there. 12% of our NAV is in Pimco CEFs. PDI and PDO being the 2 largest.
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Post by uncleharley on Dec 29, 2022 20:49:28 GMT
June and October may have given them a double bottom, but they have not trended up from there. The charts seem to be etching out a trading range instead of a trend. Today has apparently marked an end to their EOY sell-off so we shall see what they do from here.
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Post by richardsok on Dec 29, 2022 22:28:02 GMT
June and October may have given them a double bottom, but they have not trended up from there. The charts seem to be etching out a trading range instead of a trend. Today has apparently marked an end to their EOY sell-off so we shall see what they do from here. I will agree that we are near the end of the bearish trends with these CEFs --- UNLESS --- the market is smelling a cut in distributions. To my mind, the curiosity here is not that there have been a recent insider buy or two -- but why haven't there been many, many more? Why isn't the entire Pimco management suite shoveling 14%-yielding shares onto a backed-up truck at these levels? I have to disagree with your thoughts about a trading range, harley; I'm seeing one long downward trend since June of '21 right to where we are now. Of course the last 2022 tax loss selling is now exhausted for time. Next week we'll see indeed. |
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sam
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Post by sam on Dec 31, 2022 14:44:47 GMT
June and October may have given them a double bottom, but they have not trended up from there. The charts seem to be etching out a trading range instead of a trend. Today has apparently marked an end to their EOY sell-off so we shall see what they do from here. uncleharley : What I remember about you is you do Tech. analysis for your trades/investments and follow charts.
Most Pimco CEFs showed bearish divergence in early half of 2021 (March 2021 till June 2021). They peaked around June 2021 and fell below 200 SMA around Sept 2021 and never looked back. Since Sept 2021 it has been below 200/50/20 SMAs. How can you own and bullish on an asset which is clearly in downturn.
I am bond bear and do think as we may enter in an era of higher for longer interest rates. Even bond price don't either go UP or DOWN in a straight line. There are lots of fluctuations along the way. The way I see is many of these bond CEFs are suffering from "permanent impairment of Capital". Prices decline are NOT coming back to previous levels. Any move higher will be dues to CEFs portfolio performance and it will most likely not due to market kindness (like interest rates goes back to almost ZERO).
Most CEFs have sort of permanent Capital and it is almost like tenure job for Fund managers.
It has similar analogy to tech post 2000/02 bust and Financials post 2007/09. They were good buy at "Market Bottom" and if I remember correctly lots and lots people caught falling knives including Finance Guru Warren Buffet. Someone has to take permanent loss and at same time at bottom they are good buy for new owners.
PDI was $29.5 at recent peak (May/June 2021) and now it is $18.5 and sure you got like $4 dividends/distributions during that time but you need to pay tax on that one. Even IRA money get taxes once it comes out.
Q. Why have you been so bullish all along regarding Pimco CEFs? One can Never own such an asset based on Technical Analysis.
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Post by uncleharley on Dec 31, 2022 15:21:35 GMT
June and October may have given them a double bottom, but they have not trended up from there. The charts seem to be etching out a trading range instead of a trend. Today has apparently marked an end to their EOY sell-off so we shall see what they do from here. unclecharley : What I remember about you is you do Tech. analysis for your trades/investments and follow charts.
Most Pimco CEFs showed bearish divergence in early half of 2021 (March 2021 till June 2021). They peaked around June 2021 and fell below 200 SMA around Sept 2021 and never looked back. Since Sept 2021 it has been below 200/50/20 SMAs. How can you own and bullish on an asset which is clearly in downturn.
I am bond bear and do think as we may enter in an era of higher for longer interest rates. Even bond price don't either go UP or DOWN in a straight line. There are lots of fluctuations along the way. The way I see is many of these bond CEFs are suffering from "permanent impairment of Capital". Prices decline are NOT coming back to previous levels. Any move higher will be dues to CEFs portfolio performance and it will most likely not due to market kindness (like interest rates goes back to almost ZERO).
Most CEFs have sort of permanent Capital and it is almost like tenure job for Fund managers.
It has similar analogy to tech post 2000/02 bust and Financials post 2007/09. They were good buy at "Market Bottom" and if I remember correctly lots and lots people caught falling knives including Finance Guru Warren Buffet. Someone has to take permanent loss and at same time at bottom they are good buy for new owners.
PDI was $29.5 at recent peak (May/June 2021) and now it is $18.5 and sure you got like $4 dividends/distributions during that time but you need to pay tax on that one. Even IRA money get taxes once it comes out.
Q. Why have you been so bullish all along regarding Pimco CEFs? One can Never own such an asset based on Technical Analysis.
First of all, my handle is uncleharley, not unclecharley. 2nd My purchases of PIMCO CEFs began in 11/9/22 with the most recent purchase on 12/22/22. If that meets your interpretation of "All Along" then why are you referencing chart patterns from 2021 and 2020? 3rd, I don't care if you are a bond bear. 4th, What is your basis for the statement of "One can Never own such an asset based on Technical Analysis. I believe I can own whatever asset I want on any basis I want. |
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sam
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Post by sam on Dec 31, 2022 15:50:16 GMT
uncleharley: My apologies if I rub you in wrong way. I don't follow you or any one. So I did not know when and why exactly did you buy these CEFs. You can buy whatever you want with your money and why anyone should care. I never said "YOU" can't never own. My assumption was based on Tech. analysis these CEFs were in downtrend. Most people buy these CEFs for income or dividends. They have been popular all along even prices were only going down. You can use search box (if you want) and see someone was buying these CEFs during these dips which turned out to be a falling knife. My assumption was for buy and hold investors who bought these CEFs much earlier in 2020/2021 time period.
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Post by fred495 on Dec 31, 2022 16:32:47 GMT
FYI, here is an interesting comment on PIMCO income CEFs from dickoncapecod over at Fidelity:
"IMO now that tax selling is over, there is no rationale for selling income asset portfolios earning (in 2022) 11% to 14%. But we shall see. Many other managers failed to cover lower distributions, some just made it and PIMCO shot the income lights out while suffering the same realized or unrealized losses as others from the most rapid Fed tightening in decades. Finally, just so we don't suffer from reverse-think, IMO we should remember that the Treasury 5yr note is far LESS risky at 4% than 0.5%. And for example, PDI is far less risky at $19 than $29. When stocks and bonds are smeared in big bear markets, making investment decisions based on past performance is a poor strategy." |
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Deleted
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Post by Deleted on May 30, 2023 23:14:35 GMT
I had an old order in for PDO @ $12.50. It hit, much to my surprise. I think collecting 12.29% while waiting for price to recover may not be a bad idea. I hope they maintain the div %.
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