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Coronavirus Investing

Discussions about the economic and financial ramifications of PEAK OIL

Re: Coronavirus Investing

Unread postby vtsnowedin » Sat 05 Dec 2020, 09:24:01

evilgenius wrote:A few weeks ago I bought HEP at about $12. It's gained about $3 since.

Nice catch. I had not seen that one or considered it.

I think they can get back to hovering around $24. The beautiful thing about HEP is that their dividend is built for that higher price. It is absurdly high right now because of the current low price range. If this period were not temporary by definition, I think I could expect a dividend cut. ....?

Exxon is in much the same situation. If the oil price continues to rebound they should be able to maintain their dividend but a rising share price will make the percentage look smaller.
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Re: Coronavirus Investing

Unread postby Outcast_Searcher » Sat 05 Dec 2020, 13:06:32

evilgenius wrote:A few weeks ago I bought HEP at about $12. It's gained about $3 since. I think they can get back to hovering around $24. The beautiful thing about HEP is that their dividend is built for that higher price. It is absurdly high right now because of the current low price range. If this period were not temporary by definition, I think I could expect a dividend cut. This isn't the only stock like this, I'm sure. It just stood out for me because I watch it. I wonder if anybody else, like with the CVX dividend example, has seen this same situation develop with stocks they watch?

I have no good examples, as I've mostly noticed dividend cuts with bad business results, which is common in deep recessions (or worse).

If libraries are open or if you don't mind paying up for data (maybe $800ish a year, re their ads, as I recall), "The Value Line Investment Survey" which publishes solid, well organized fundamental data on thousands of large cap stocks in many industries, has a summary section each week that shows various interesting ranks of the stocks it covers, sorted various ways. One of those stock screens/ranks is by dividend yield. In past recessions when I was less lazy and less into AVOIDING public places, I used to find interesting ideas to research looking at that ranking. Last I checked, they had both a print and online version.

For one example, I got into the MLP space, upon seeing how both the dividends AND the business of quality midstream energy MLP's (see AMLP ETF for a sampling of such companies) held up well during the great recession, but such MLP's generally got killed because of the panic over low oil prices.

This time the dividends came some down too, partly due to tax / policy changes, but AMLP got killed spectacularly over, again, apparently over panic in the energy business and economy.

It's up quite a bit now compared to the bottom, though Yahoo shows the dividend still at nearly 12%. So IF the economy recovers in a year or two and things return to more or less normal, that COULD work out well by early doubling and raking in a nice dividend (which might grow a bit too) while that occurs.

Or not of course, but the point is I would expect an ETP like that to show up clearly in the dividend screen of Value Line (which is what I recall them calling the sort by high yield).

Though I do NOT think Value Line's recommendations outperform the market despite their claims, I DO think that looking at quality fundamental data and long term relative stock prices vs. business conditions in a professional, unemotional format, is useful for people who want to pick stocks. Disclosure -- I am a fundamental investor -- others like to follow chart patterns. As I recall, they had other useful screens like low PE stocks, unpopular stocks (I forget the particular methodology), etc.

YMMV, just pointing this out, IN NO WAY am making an investment recommendation here -- just suggesting a practical high dividend screen, since you mentioned looking for high dividend stocks. I used to like to go quarterly (Value Line cycles through all the stocks they cover every 13 weeks) to the library and see the updates, since it was free and didn't take too much time. (While my dad was alive, he took Value Line and used to give me his quarter-old issues instead of throw them away, which is how I stumbled onto that service).
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Coronavirus Investing

Unread postby Outcast_Searcher » Sat 05 Dec 2020, 13:13:43

So I just took a look at HEP, and I see that it is actually a component of AMLP. Obviously I did that backwards on the timing. :oops:

The observation re a useful dividend screen still stands, as an investment searching idea though, especially in the age of the internet, spreadsheets, etc.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Coronavirus Investing

Unread postby evilgenius » Sun 06 Dec 2020, 09:15:18

Lately, I have been concentrating on finding out what might work in the world of tomorrow. The importance of energy is easy to overlook. Unless somebody revisits and succeeds in developing Tesla's concept of wireless electricity transmission, batteries are going to be central to vehicle, and other, operations in the future. But batteries alone won't capture the future. Batteries need a grid that can handle the load of recharging them routinely. Most of the stocks I am looking at are not dividend payers, but growth stocks.

I like to receive dividends, not just share price increases. But share price increases are far more powerful than dividends, if I am going to be honest. HEP appealed to me in part because I knew they had a higher dividend. I've had them, along with many others, on an oil industry watch list for some time. They weren't a great growth stock, though, for the reasons mentioned. But they seemed reliable in that mid stream role. They looked like they were the victims of an oversold condition. Figuring that they wouldn't go bust, I took a chance. I was waiting for oil to come back, but mid forties and what looked like a true rise across many industry players convinced me that the smart money was already in. I don't have to sell them when they go back up, in order to take advantage of the little bit of "growth" that they did enjoy climbing back up from that condition. The dividend, when buying at oversold prices, is high enough to make holding them worth it. You know, the time value of money and whether there is an opportunity cost that comes with not having your money elsewhere.

The thing I didn't do was buy enough of them when I did. They should keep going up, but I'm not sure about the wisdom of chasing growth when I believe it has a kind of cap to it. But, probably, fifteen is not too high a price to pay now and still enjoy the situation. I don't know if I would feel the same if I got in as high as eighteen. I'm just so cautious. It's hard for me not to try and reach balance rather than celebrate something like lust. If I had bought more then I could have better leveraged that dividend to buy shares of whatever I'm interested in. I didn't think that far ahead when I was considering my actions. I just thought about the basic numbers. Still, it does look like a good situation. If I keep reminders of my failures around to remind myself of how easy it is to make mistakes, then looking at this, as few shares as it is, sitting in my portfolio should remind me to take chances as well.
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Re: Coronavirus Investing

Unread postby Pops » Sun 06 Dec 2020, 09:21:22

vtsnowedin wrote:My Covid _19 investment today was a fifty pound bag of locally grown potatoes for $10.00. That should last the two of us well into the winter when grocery store staff will have been vaccinated. :)

Now you're talking my language!
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Re: Coronavirus Investing

Unread postby vtsnowedin » Sun 06 Dec 2020, 09:35:58

Pops wrote:
vtsnowedin wrote:My Covid _19 investment today was a fifty pound bag of locally grown potatoes for $10.00. That should last the two of us well into the winter when grocery store staff will have been vaccinated. :)

Now you're talking my language!

Everyone needs a bit of diversity in their portfolio along with some liquidity in the pantry. (JD Old number 7) :)
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Re: Coronavirus Investing

Unread postby vtsnowedin » Sun 06 Dec 2020, 09:47:32

evilgenius wrote:Lately, I have been concentrating on finding out what might work in the world of tomorrow. .....
.........

I am doing that but only placing part of my bets on new tech and for the most part avoiding startups. Now traditional old companies that are embracing new tech are very attractive as they have existing profits and dividends plus a bright future. Toyota's moves on plugin EVs. and full EVs. for example. It is not going to double for you in a year but it probably will be ahead of the market average for years to come.
On the startup wild guess side I'm watching LAZR that just made it's 25 year old founder a billionaire. His product is essential for improving the safety of self driving vehicles so his potential market is huge. The IPO just happened and perhaps after they hype wears off and it settles down I'll place a chip on that square.
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Re: Coronavirus Investing

Unread postby evilgenius » Sat 12 Dec 2020, 05:19:32

vtsnowedin, I had thought that a company like UPS would be a good investment candidate concerning AI. They are going to have to compete using that at some point. After working for them for a while, I don't know now. They seem quite happy to drone along with the human way of doing things. One thing I would look for that could signal a change would be if they implemented a standard, or ideal, package size for various applications. With that, they could eliminate a lot of what AI would have to think about. The airlines did it with carry on sizing. There is no reason package deliver to people's homes shouldn't be as standardized, across ranges of applications.

It's hard enough loading trucks. It's harder when the company has all kinds of policies and procedures that don't empower you, like no standard package size so that one is always dealing with too many unknowns, AI doesn't like unknowns, when one's decisions have a direct effect upon whether somebody else, the delivery person, has a good day. It's my hunch that when they do come around they will suddenly realize where they were making a mountain of mistakes. Instead of ordering their whole business around tangling with labor, they will have to concentrate upon true efficiency. It will be hard for them to accept that they were never really the company they always thought they were.
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Re: Coronavirus Investing

Unread postby Pops » Sat 12 Dec 2020, 19:09:11

vtsnowedin wrote: Everyone needs a bit of diversity in their portfolio along with some liquidity in the pantry. (JD Old number 7) :)

A little music to stock (or unstock) the pantry:
Devil Makes Three
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Re: Coronavirus Investing

Unread postby Newfie » Sat 12 Dec 2020, 22:44:17

Evil,
I found in my work career that private for profit corporations were nearly as bad as our public clients, very inefficient. The construction companies I worked for were pretty efficient.

One the very best organizations I was ever involved with was the USCG, back in the 1970’s. While I was there all I could see were there faults, and I was sure the private sector would be much better. Nope!
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Re: Coronavirus Investing

Unread postby vtsnowedin » Sun 13 Dec 2020, 04:17:55

Pops wrote:
vtsnowedin wrote: Everyone needs a bit of diversity in their portfolio along with some liquidity in the pantry. (JD Old number 7) :)

A little music to stock (or unstock) the pantry:
Devil Makes Three

:-D Very good.
Just invested in one 1.75L share of old #7. It will pay dividends throughout the holidays but will lose value and have to be replaced. 8)
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Re: Coronavirus Investing

Unread postby evilgenius » Sun 13 Dec 2020, 09:37:53

Newfie wrote:Evil,
I found in my work career that private for profit corporations were nearly as bad as our public clients, very inefficient. The construction companies I worked for were pretty efficient.

One the very best organizations I was ever involved with was the USCG, back in the 1970’s. While I was there all I could see were there faults, and I was sure the private sector would be much better. Nope!

Yes, I think UPS will do AI, and the resultant self-operated things that go along with it, but they will purchase rather than grow it themselves. The trouble with that, if you are into them for the long haul, is that leaves them wide open to the same sort of disaster that befell taxi companies. Taxi companies are not coming back like they did before Uber. The knowledge of how to do the lowest cost shipping operation is enough to win today. After gaining it, all a company needs is the right sort of financing to replicate whatever the going infrastructure is, plus the upgrades. Having the infrastructure beforehand is not as valuable as it once was. It can even be subcontracted into place. The right properly funded startup could just buy UPS, except why would they want to purchase all of the long term obligations along with the infrastructure? Isn't that why a startup like NIO can outperform the existing big auto companies, as if they didn't exist in the future's calculations?

If UPS were involved in organizing and proofing their data regarding so many of the soft power aspects of package delivery, like how drivers interact with certain types of customers, or how packages are damaged at certain points in the system due to humans expressing something about absurdity, then I might think they were looking like they were facing the future. They provide a lot of training, but they don't listen to what it means when people aren't perfect. They ask people to perform in the face of absurdity, but have no notion as to how their employees pull that trick off. The robots will need to know those answers too. As it stands, they seem like they are holding onto the last decade of the Twentieth Century as fiercely as they can while trying to adopt so many aspects of the Twenty First as keep them comfortable. Meanwhile, the rest of the world is racing along. They've only gone largely untouched by all of the changes because of an assumption of something like boredom about them. They are just lucky they weren't as sexy, and easy, to displace as cab companies were to begin with. You know what's funny is they make a good proxy for the Republican Party, in this manner. In this case, they exemplify the plight of the "can do" attitude in the face of the changes that are being wrought by the new century. This is the information century, after all. Can do is not the edge it once was. All of the can do people are busy complaining about millennials for that very reason.
Last edited by evilgenius on Sun 13 Dec 2020, 09:58:36, edited 5 times in total.
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Re: Coronavirus Investing

Unread postby vtsnowedin » Sun 13 Dec 2020, 09:48:17

I am less gloomy about UPS's future. Most of your on line purchases are delivered to your door and UPS goes by daily delivering to my house and the neighbors. I see steady growth for the industry and the biggest change might be Amazon buying them up to control things start to finish. They are very competitive with FEDX so modernization will be ongoing. So not the sexiest stock in the world just a steady growth with a nice dividend (2.4%) at present and one I will keep for five years or more and might add to during any dips in price.
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Re: Coronavirus Investing

Unread postby Plantagenet » Tue 15 Dec 2020, 00:31:37

A new variant of the Covid virus has been identified in SE England that is spreading more rapidly then the existing varieties.

mutant-covid-more-transmissible

We should all keep an eye on this.

This new mutant Covid virus has the potential to start a new surge of Covid around the world, just as new mutant varieties of the flu virus appear each winter and then spread around the world.

Image
DANGER!! MUTANT COVID VIRUS! DANGER! DANGER!!

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Re: Coronavirus Investing

Unread postby vtsnowedin » Tue 15 Dec 2020, 06:11:00

Let's hope the present vaccines will work against that strain as well as it dose the original one.
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Re: Coronavirus Investing

Unread postby JuanP » Tue 15 Dec 2020, 07:15:14

"New COVID-19 strain found in UK ...
https://www.rt.com/uk/509651-covid-mutation-uk-virus/

"The agency’s Dr Michael Ryan confirmed on Monday that the WHO is “aware of this variant,” explaining that the mutations of viruses are “quite common.”

His WHO colleague, Dr Maria Van Kerkhove, added that the variant identified by Hancock is the ‘N501Y’ mutation, which scientists have been studying since the early months of the pandemic.

“It’s being monitored already by our virus evolution working group, it’s come up in the context of a mink variant identified elsewhere,” she said.

Coronavirus mutations in mink have been reported in countries including the Netherlands, the US and Denmark, with the Danish government ordering the cull of 17 million animals in November."

That strain is new to the UK, but is a strain identified months ago at other locations. All the vaccines being developed are supposed to work on that strain. The strain is not more deadly, it just spreads faster. This is only news for the UK, not the world.
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Re: Coronavirus Investing

Unread postby REAL Green » Tue 15 Dec 2020, 07:27:08

“Negative-Yielding Debt Exceeds $18 Trillion As Global Market Cap Hits $100 Trillion”
https://www.christophe-barraud.com/en/t ... erventions

“The pool of negative-yielding debt across the world exceeded $18 trillion for the first time in history, according to Bloomberg data. The move came after the ECB announced it will expand its massive monetary stimulus program by another €500 billion and will extend emergency bond purchases for nine months. In a context where global economic policy uncertainties remain particularly high (Covid-19, Brexit, U.S. fiscal stimulus, etc.), it seems that central banks in advanced economies are ready to be even more accommodative in the coming months to support confidence and economic activity. As a reminder, according to my calculation, G7 central banks’ combined balance sheet has already increased by more than $8.0 trillion since February 2020.”
realgreenadaptation.blog
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Re: Coronavirus Investing

Unread postby vtsnowedin » Tue 15 Dec 2020, 17:25:29

You would think the vaccine makers stocks would be going up with the beginning of deliveries but you would be wrong. Both Moderna and Pfizer have gone down for four of the last five trading days. Apparently early big investors are cashing out their profits but are not dumping large enough blocks of stock to tank the price and are instead selling some each trading day which keeps the price from rising.
I still have a nice profit in both but it is educational seeing gains drop back just as fast as they came in. Two to five percent per day.
On another note I compute my place in line for a first vaccine shot to be in mid February or sooner if more then two vaccines get approved. I'm in the over 65 but not that unhealthy group so by the time they get to me all Americans over 65 or with commodities will have been vaccinated so death rates should plummet.
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Re: Coronavirus Investing

Unread postby Plantagenet » Tue 15 Dec 2020, 18:14:24

vtsnowedin wrote:You would think the vaccine makers stocks would be going up with the beginning of deliveries but you would be wrong. Both Moderna and Pfizer have gone down for four of the last five trading days. Apparently early big investors are cashing out their profits but are not dumping large enough blocks of stock to tank the price and are instead selling some each trading day which keeps the price from rising.
I still have a nice profit in both but it is educational seeing gains drop back just as fast as they came in. Two to five percent per day.


This is standard operating procedure in the stock market. The old Wall Street saying goes: Buy on the rumor....sell on the news.

The vaccines are now approved and being distributed.....that is "the news" and the people smart enough to buy a few months back are taking their profits. By the way...congrats on your nice profits.

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vtsnowedin wrote:On another note I compute my place in line for a first vaccine shot to be in mid February or sooner if more then two vaccines get approved. I'm in the over 65 but not that unhealthy group so by the time they get to me all Americans over 65 or with commodities will have been vaccinated so death rates should plummet.


Watch out for the Biden administration changing the rules and pushing "people of color" or some other favored group to the front of the line for vaccine.

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Re: Coronavirus Investing

Unread postby vtsnowedin » Tue 15 Dec 2020, 19:45:53

Plantagenet wrote:Watch out for the Biden administration changing the rules and pushing "people of color" or some other favored group to the front of the line for vaccine.

Cheers!

Oh I expect that but as many of the people of color are also over age 65 and have commodities, or work essential jobs, they were already ahead of me in the line so the actual difference Biden makes in my place might be less then a week.
Biden and his administration should take a long clear look at what has and is happening on January 20th and if "it ain't broke don't fix it". They will probably make some changes just to show they are in charge and they "care more" but they should be careful to not make things worse.
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