Buying JNK while trying to avoid junk

I have been out of junk bonds ever since Milken went to jail. Back in February of this year I was “highly confident” that junk bonds were going to survive. At least I hoped, for I was finally ready to jump back in and wallow around in some junk. Since finding ETF religion I decided that was a good place to look first. I have to respect any company that just says it the way it is. When Barclay named its ETF JNK you just knew they weren’t going to try and BS anyone about the quality inside. Well you know what they say, one mans junk is another man’s tres… Well one can always hope right.

So back on February 10th I picked some up at $31.45 and then watched it continue to sag. (What was the name of this thing again?) On March 2nd I tried again at $27.50. Trying to break bad habits these two investments amounted to a little under 20% of my account. Contrast that to a few years ago when a good feeling, I know I have a winner position would have been over 60% and the whole account leveraged. Oh the good old days.

The investment rationale was that the divvy was so crazy high even if a bunch of the bonds defaulted the divvy would still be 10% plus. All we had to do was avoid the whole capitalism system from going under.

So far JNK has paid out roughly 40 cents per share per month since then. April and May were a tad higher. Did I mention that JNK pays out monthly? (I like that part. Monthly cash; dollars and change that you can believe in.)

Old mindsets are hard to counter. I look at the chart since Feb. and all I see is: I could have jumped in and out here and here and here and there. But alas I haven’t, I sit and wait for the beginning of the month. Until the divvy story changes this chunk of my account will be long and slow with JNK.

Here’s to getting a grip with jumping in and out, fast money, trading and to keeping an eye on your EveryDay Money.

Back into the light

Is it safe to come out yet? Maybe I should begin with is it even safe to look yet? It certainly has been a long while since my last post. When the darkness comes and threatens the very foundation of capitalism I find it best to pull family close and hang on.

A brief recap: Couple of years ago had some CROX stock and a few others in an account that I thought was destined to be my early retirement. The gains were easy, fast, and large. The market cracked. I made one stupid mistake after another. The market broke. My bad trade decisions snowballed into insanity. Tried very hard to run the account to zero and almost succeeded. Ducked and covered for what has felt like decades. Found ETF religion. Am currently in the process of gluing the jagged and charred pieces of my account back together. Took a hesitant step back into the light. Finally back to writing.

Here’s to sunshine on your face, accounts that don’t read zero, and to keeping both eyes on your EveryDayMoney.

Kraft, Oreos, and Me

Two questions come to mind as I wait and watch for MO to spin Kraft at the end of this month. 1) Can Kraft come up with any more flavors or combinations of Oreos than they have right this minute? 2) Is there any money to be made by holding Kraft after the spin?

There is some kind of a societal comment to be made when I have to hunt just to find some original Oreos among a sea of Mint, Double Stuff, Chocolate cream, Chocolate covered, Mini-bite size and on and on, I’m just not sure what that comment would be. I found some originals; I’ll work on the commentary while I’m snacking.

As far as making any money, I still think that there is money to be made. It just might not be made right this second. Reading the message boards it seems that most have written off KFT and most are certain that MO share price will raise quickly. Watching Kraft the past few days I can see why most might feel that way. Today we were down 2.36% on super big volume. That troubles me some, but not enough to be selling shares at $30 plus change. I have too much Kraft food in my refrigerator for the stock to go much under $30 for very long.

When I get my Kraft shares I’ll sit tight and wait. Not sure what price would get me thinking sell. I just need a little time after the spin to see what’s what. The nice dividend they pay will help me wait. Here’s a guy that says we should be buying at these levels not sitting and waiting. He may be right, but I am still good with waiting.

That’s it for today. Here’s to not forgetting that the Original Oreos still have it and to keeping an eye on your EveryDay Money.