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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: rllee who wrote (50043)	11/14/2012 11:56:22 AM
From: Jurgis Bekepuris	Read Replies (1) \| Respond to of 78717

Rllee, good question. Actually most high yield / prefs are bets regarding the solvency of underlying company. If there were no risks, there would be no high yield. :) There is no free lunch, as they might say. So investor has to make up their mind regarding future solvency of JCP, GST, MHR or any other company they are buying the high yield securities from. KTP/PFH - there is another wrinkle - they are somehow structured by third party company and not a direct JCP prefs. I'm not sure right now if this adds another risk factor (i.e. third party going under). Comments welcome. I think I should run Z-score and/or Piotroski score on JCP, GST, MHR to see what they say in terms of the future of these companies. Bug me if I don't do this soon - I just need to find time. :)