Tag - Sheaff Brock senior portfolio manager JR Humphreys

Sheaff Brock Refresher Course on Preferred Stock

Preferred Stock 101+

(Quick Preferred Stock “cheat sheet” coaching session for those “in the know,” but who could use a little reminder before investing): Companies raise capital by either borrowing money or by selling ownership. To accomplish that goal, they issue either debt or equity securities. As an alternative, by issuing preferred stock, a company combines the characteristics of both debt and equity. There are some advantages to a company that issues preferred securities: Issuing preferred stock as opposed to bonds keeps the [...]

Actively Sailing Showing Active Management of Portfolios | Sheaff Brock Investment Advisors

Staying Active with Preferreds

The Sheaff Brock Preferred Income portfolio is an actively managed strategy, and there are reasons why. With the two-part goal of generating income while preserving capital, Senior Portfolio Manager JR Humphreys utilizes both institutional and retail preferred shares. No question as to which side of the ongoing debate about the merits and shortcomings of active vs. passive management is exemplified in the Preferred Income portfolio. So, what is the distinction between active management and a passive approach? Passive investors buy an [...]

REIT Investing and the New Tax Law | Sheaff Brock

New Tax Law May Favor REIT Investors

The Tax Cuts and Jobs Act is set to deliver significant tax savings over the next decade, which might well help an already healthy economy, says JR Humphreys, portfolio manager of the Sheaff Brock Real Estate Income & Growth strategy. Here’s why, Humphreys continues: One of the central features of the tax bill is a 20% deduction on pass-through income. By law, REITs must distribute at least 90% of their income. And, since the REITs themselves do not pay tax [...]

REITs | Bricks in the Wall of Worry? | Sheaff Brock

Real Estate Investment Trust Valuations—Bricks in the Wall of Worry?

The “Wall of Worry,” an informal expression used in financial jargon since the 1950s, refers to a market uptrend that occurs when there is significant uncertainly about stock price sustainability. But what about REITS? Are these stock/real estate hybrids bricks in the “Wall” as well? “Long before investors fell in love with Facebook and Amazon.com or even the hot stocks of past generations such as utilities and railroads, real estate inspired dreams of wealth,” writes John Coumarianos. “Some financial advisers and pundits helped [...]

Sheaff Brock Preferred Stock portfolio | question marks about rising interest rates

Preferred Stock—Expect the Question; Consider the Answer

The unrelenting search for reliable investment income is an important theme in retired clients’ investment plans, and preferred securities certainly share the limelight. What’s more, given the current buzz about the new tax law, it’s hard to ignore the fact that certain features of the law can favor investing in preferred stock, potentially increasing the demand for high-income investment vehicles. The question: As you’re discussing this very topic at the tennis club, expect the question: Interest rates are on the rise. By [...]

Sheaff Brock Preferred Income Portfolio | Impact of New Tax Law on Preferred Stock

New Tax Law Bodes Well for Companies Issuing Preferred Stock

There’s a whole lot of media buzz going on about the new tax law and how good a thing that law is turning out to be for corporate America. Turns out, certain features of the law may be a very good thing for investors in preferred stock as well. What’s that all about? First, by way of quick review, preferreds are hybrid securities, blending traits of both stocks and bonds. Preferreds, like common stock, represent ownership in a company, but [...]

Interest Rate Signs Increasing in Size | Managing Interest Rate Risk for Preferred Stock Income | Sheaff Brock Investment Advisors

Managing Interest Rate Risk in a Preferred Stock Portfolio

If I invest in preferred stock for the income just when interest rates are rising, won’t I be setting myself up for losing money? “Not necessarily,” contends JR Humphreys CFA, CAIA, Senior Portfolio Manager at Sheaff Brock Investment Advisors. Humphreys explains that, “increasing interest rates is usually the result of an improving economy that could lead to credit rating upgrades for the preferred equity, resulting in a higher price.” Many investors have the perception that preferred securities are highly interest-rate [...]

Sheaff Brock Investment Advisors | Indianapolis | Preferred Stock Performance | Asset Class

Will Higher Interest Rates Huff and Puff Your House Down?

Ever since (think back approximately a year-and-a-half) rates began their slow upward movement, income investors have experienced a certain degree of worry about the “big bad wolf” blowing down their carefully constructed investment “abodes.” Thankfully, as Sheaff Brock senior portfolio manager JR Humphreys, CFA, CAIA explains, if you’ve “built” for the longer term (planning a longer holding period), there may be little reason for concern. In fact, Humphreys pointed out in an October interview with our SheaffBriefs editor, since December [...]