[clearfund]

Allan – How is buying a high quality building with conservative underwriting and an all cash yield (read: zero debt) north of 12% (based on rents well below today’s depressed rental rates) speculating? I’d call it investing. Sure, the investment could go south, but so could any other investment/company.

I seem to recall the bulk of wall st. firms and their “simple valuation tools” being way off the mark so I wouldn’t hang your hat on that analogy.

To me, investing is based on conservative/historical fundamentals, speculating is based the need for a rising market to make the deal work.

I would say that buying a newly constructed class “A” bldg on a great location at 50% of replacement value that needs 40% occupancy to break even is investing, not speculating.

[clearfund]

Allan – How is buying a high quality building with conservative underwriting and an all cash yield (read: zero debt) north of 12% (based on rents well below today’s depressed rental rates) speculating? I’d call it investing. Sure, the investment could go south, but so could any other investment/company.

I seem to recall the bulk of wall st. firms and their “simple valuation tools” being way off the mark so I wouldn’t hang your hat on that analogy.

To me, investing is based on conservative/historical fundamentals, speculating is based the need for a rising market to make the deal work.

I would say that buying a newly constructed class “A” bldg on a great location at 50% of replacement value that needs 40% occupancy to break even is investing, not speculating.

[clearfund]

Allan – How is buying a high quality building with conservative underwriting and an all cash yield (read: zero debt) north of 12% (based on rents well below today’s depressed rental rates) speculating? I’d call it investing. Sure, the investment could go south, but so could any other investment/company.

I seem to recall the bulk of wall st. firms and their “simple valuation tools” being way off the mark so I wouldn’t hang your hat on that analogy.

To me, investing is based on conservative/historical fundamentals, speculating is based the need for a rising market to make the deal work.

I would say that buying a newly constructed class “A” bldg on a great location at 50% of replacement value that needs 40% occupancy to break even is investing, not speculating.

[clearfund]

Nice, snarky comments…but any comments pertaining to Bubba99’s original topic??? would enjoy hearing pros/cons others have had with these types of securities?

[clearfund]

Nice, snarky comments…but any comments pertaining to Bubba99’s original topic??? would enjoy hearing pros/cons others have had with these types of securities?

[clearfund]

Nice, snarky comments…but any comments pertaining to Bubba99’s original topic??? would enjoy hearing pros/cons others have had with these types of securities?

[clearfund]

Nice, snarky comments…but any comments pertaining to Bubba99’s original topic??? would enjoy hearing pros/cons others have had with these types of securities?

[clearfund]

Nice, snarky comments…but any comments pertaining to Bubba99’s original topic??? would enjoy hearing pros/cons others have had with these types of securities?

[clearfund]

I have been actively reading it for over a year + but have never registered/commented till now.

[clearfund]

I have been actively reading it for over a year + but have never registered/commented till now.

[clearfund]

I have been actively reading it for over a year + but have never registered/commented till now.

[clearfund]

I have been actively reading it for over a year + but have never registered/commented till now.

[clearfund]

I have been actively reading it for over a year + but have never registered/commented till now.

[clearfund]

Bubba – The GSE Strips are guaranteed so no worry there. The reason for the interest rate is that because they are a zero-coupon note where you receive interest and principal at the maturity date.

Thus, they nearly always trade at a discount to the face value of the note to account for the lower IRR, etc of the zero coupon.

We invest/trade in this general area and are achieving north of 15% (some trades net us 40%+/yr) annual cash flow with investments back by GSE Bonds which are all guaranteed.

We trade in/out of the GSE Bonds around dividend dates so we capture excess levels of dividends with very short holding periods/exposure.

[clearfund]

Bubba – The GSE Strips are guaranteed so no worry there. The reason for the interest rate is that because they are a zero-coupon note where you receive interest and principal at the maturity date.

Thus, they nearly always trade at a discount to the face value of the note to account for the lower IRR, etc of the zero coupon.

We invest/trade in this general area and are achieving north of 15% (some trades net us 40%+/yr) annual cash flow with investments back by GSE Bonds which are all guaranteed.

We trade in/out of the GSE Bonds around dividend dates so we capture excess levels of dividends with very short holding periods/exposure.

[Author]

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