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Non-Tech : Income Investing
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KEN2CWL
To: YieldHog who wrote (10799)7/3/2014 10:56:48 AM
From: mopgcw1 Recommendation   of 52052
 
Re: re GST-B

As for GST-B, as I previously stated, in my opinion it is way to early to sell this. It has not even been issued for a year and is over 4 years to the call date.

I concur, and I own GST/B and MILL/D. they are both staying in the portfolio. I cannot come close to replacing my current yield on those dollars -- it is a negative trade today and there is no compelling reason to exit here. And I don't have to pay taxes on the trade for these.

GST/B may indeed and hopefully will improve their finances prior to the call. But I am not sure credit spreads and absolute rates will stay where they are today in the 4 years from now. One really needs to look at a total return comparison to see if the trade makes sense swapping out today in conjunction with one's view of rates and credit spreads.

And drpirhana - you are correct, these are not options and do not decay similar to an option to the expiration.
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