Product Description
Preferred Stock Investing shows you how to screen, buy and sell the highest quality preferred stocks to earn above average dividend income while creating multiple downstream capital gain opportunities. Fixed-income investors already know about Doug K. Le Du’s preferred stock research newsletters. Doug writes in plain English for non-experts. And now his latest preferred stock research is available in Preferred Stock Investing. And this completely updated edition, with five new chapters, also explains how to invest in the highest quality preferred stocks during a Global Credit Crisis.
Preferred Stock Investing starts at the beginning, explaining what preferred stocks are, the three different types and the pros and cons of investing in them versus common stocks, bonds or bank Certificates of Deposits. From there, Preferred Stock Investing uses actual preferred stocks to show you how to screen, buy and sell the highest quality issues. And Preferred Stock Investing also includes an easy and fascinating analysis that allows you to quantify the risks and identify high quality preferred stocks that the market has either overpriced or underpriced.
Also, through the book’s website readers of Preferred Stock Investing are supported by a wealth of continuously updated resources, including a free monthly newsletter that provides tips and answers to reader’s questions. Chapter 15 of Preferred Stock Investing lists all qualifying preferred stocks that have been issued since January 2001 and shows you the actual investment results that you would have had following the preferred stock investment method described throughout the book. As a reader of Preferred Stock Investing, you are entitled to free periodic updates to the preferred stock lists in Chapter 15.
The information presented within Preferred Stock Investing makes it very clear that the highest quality preferred stocks represent one of the best investment opportunities for individual investors.
29 Mar
2:50 am on March 29th, 2010
This is a good book but reader needs to be careful about the risk
involved in preferred stock investing. Half of the purchases made
by the author in 2006 was not sold yet, and as of Apr 27, these shares
are down on average about 15% in market value. Even if you count the
9-10% in dividends that had been paid, you are probably still 5-6%
underwater. One of the purchases is CFC-B, which went from 25 to 6
at one point only to come back to 14 as of Apr 27. I am not sure
if the average reader would have the stomach to withstand this kind
of draw down. Since many preferred stocks were issued by finance
companies, I suspect purchase made by the author prior to Aug 2007
may suffer even heavier paper losses.
Reader who buy this book with the expectation of getting 12% return
with very little risk and retire needs to be realistic
I have many stock trading systems that returned on avg of 30% for 6-7
years in back testing before Aug 2007 but are down 40% since then.
I would like to see more discussion on the risk of perferred stocks,
how they would perform in bankrupcy and liquidation, etc. Readers
also should not blindly follow rating agency’s ratings.
Thorburg mortgage’s preferred stocks went public last year with a 10%
coupon, and the price dropped from $25 all the way below $2 and has
come back to over $4 recently. I heard that Pimco’s Bill Gross
bought some of those preferred below $2. It would be interesting to
understand how he analyzed the risk of TMA’s preferred and made the
call.
Rating: 3 / 5
3:47 am on March 29th, 2010
Several things struck me about Preferred Stock Investing. Doug K. Le Du’s writing style leaves you feeling like you’re reading something from an old friend. The book is very comfortable to read and easy to understand. But the most remarkable part is how frequently I found myself feeling like “ah hah, of course this would work this way.” Unlike many other investment books that I’ve read, it is really clear how and why the preferred stock investment method that is described in the book would work, with very little effort. And all of the preferred stocks for years listed in the book too so you don’t have to take it on blind faith; the book includes the investment results, using the method that the book describes. In the beginning of the book, the author says that if you are a high-risk taking day trader looking for a quick 25% return, this book is not for you; this is correct. This book is for low-risk, methodical investors who do not want to spend a lot of time studying their computer all the time. I learn a lot and it was fun to read.
Rating: 5 / 5
5:18 am on March 29th, 2010
This book’s advice is misleading, and this is unfortunate given that it’s one of the only publications available on preferred stocks.
1. The author fails to point out the major underlying risks of preferred securities. Preferreds are only one step above regular stocks in credit safety, should the issuing firm declare bankruptcy. Firms that issue preferreds can and do fail, often wiping out the preferred investors. And yet the author suggests that the risk of preferreds is “CD-like” (FDIC insured up to $100,000) throughout the book. Not true!
2. The author conveniently ignores the reverse “cannonball” price curve in his visual graphics, thereby implying that most preferreds rise in price after issuance and then recede back down to par at the redemption or call date. When rates rise and/or the issuing firm suffers in performance (think Countrywide!) prices will fall and may stay low, NOT recovering to par at the first call date. An investor may not be able to “upgrade” without a loss. Again, the author is not being truthful about what actually can of often does occur.
3. The author fails to point out that investors can often purchase preferreds at well below par, taking advantage of market price drops when the issuer’s health has not deteriorated. By acquiring only at/near IPO prices, investors who follow his advice may severely limit their upside.
4. The book reads like one long, and cheesy infomercial peddling the author’s “subscriber” services. If you want to avoid the pain of losing money in preferred stocks: don’t buy this misleading book or his services!
Rating: 1 / 5
6:25 am on March 29th, 2010
This well written book offers an entirely new approach to investing in preferred stocks (PS), an approach that will maximize your profits while minimizing your risk and minimizing your work effort. PSs are recommended for your investment considertion ONLY IF they meet 10 strict market and investment criteria. If a PS meets ALL 10 criteria, they pass the test to qualify as a “CDX3″ stock. Well-written and precise guidelines are then given on how and when to buy “CDX3″ stocks, even when market interest rates rise or fall. The author includes over 5-years of historical market results to document & support his approach. The monthly free newsletter to subscribers is an outstanding source of investing information. Highly recommend this book!
Rating: 5 / 5
7:59 am on March 29th, 2010
I’ve purchased three copies of this book: first one for me, and then after I started following the CDx3 method, one for my financial advisor, and one for my Dad. My copy is highlighted and marked with Post-Its because I don’t remember everything from one reading and I like referring back from time to time. I set up my preferred stock investing system in a binder that I only need to pull off the shelf once or twice a month. For that small investment of time, I am very pleased with the results from following Doug’s approach, so clearly spelled out in the book and made even easier with his subscription service doing all the legwork, so I can invest wisely while still having time for everything else. Contrary to some reviewers’ remarks (did they actually read it cover to cover???), it’s easy to successfully use the system described in this book without an interest rates crystal ball and even if you want to avoid issuers in certain industries, as part of a balanced investment plan. The book is educational, clear, fun, easy to read, and pays for itself many times over! Go for it!
Rating: 5 / 5
8:29 pm on June 10th, 2010
omg alright so here’s how brainless I am, midway through looking through your post I dropped my mouse and shut down the site by accident and I couldn’t locate your post once again right up until 6 days later on to finish reading from the point i stopped at mainly because I didn’t remember how I linked to your site to begin with haha anyway it was worth the wait..kudos