Today Markets broke out from the recent downturn, with all major indices rising more than half a percent. Our portfolio returned similar results, with Ford Motors (F) leading the gains. We were hampered somewhat by a slide in US Steel, which generated unrealized losses but due to the nature of the position the projected return is actually unchanged (it’s currently capped around 9%). We took a very small position in HD building supplies (HD) in anticipation of tomorrow’s earnings announcement, and we expect to close shortly thereafter.
We’re currently working on a widely diversified multi asset portfolio that we hope will bring stable returns to a large portion of the overall fund. We’ll have more information on that tomorrow, but we don’t expect the model to be complete until the middle of next week.
Back to older news – the first distribution since we took our position in Frontier Communications (FTR) preferred shares (FTRPR) is scheduled to occur in the next two weeks, and we’re anticipating a sharp drop-off in the value of those shares. If the drop is significant enough we will definitely consider growing (up to doubling) that position. The drop will likely occur as investors who were waiting for the next dividend to exit the position do so, there will be far more sellers than buyers for at least a few hours.