The month (and quarter) has drawn to a close and am waiting for some foreign dividends to post before being able to officially call the month. It appears that the dividends are up Y/Y, down Q/Q (mostly due to a shift in pay date) and portfolio flat against the S&P. But I’ll do my normal elaboration next week.
The Kid’s First Double!
As I’ve mentioned before, I’ve established a small portfolio for my granddaughter. The merger of Washington Gas Light (WGL) into AltaGas was conditionally approved Friday. If accepted by the companies, the merger should be effective on Friday with the checks arriving mid-July. The kid is stoked about her second merger – and this one being a double all in cash! The only slight disappointment is that the proceeds will be going back into the market rather than her piggy bank.
The market appears to be unsettled. Housing and jobs were strong but the market was adrift primarily due to tariff fears and the increasing federal deficit. Harley-Davidson (HOG) was on the receiving end of Trump’s ire when they announced that a production line (and soon to be former US jobs) may move to Europe in order to remain competitive in a post-tariff world. General Motors (GM) didn’t make the same mistake – only identifying that new car prices would increase by $5-6,000 per vehicle due to tariffs. The president has indicated a NAFTA negotiation delay until after mid-terms while Japan is pressing to conclude the RCEP (TPP minus the US) by year end. The good news? A steel line is reopening in Illinois and corporate profits are generally up. The current consensus is that economic gains from tax cuts and regulatory relief have been frittered away by the tariff hammer.
Minor League Arbitrage
I finally identified a viable use for my newest broker M1 Finance. With the recent approval of the Crapo bill, the gates have opened once again for small bank mergers. Five deals involving banks I own have been announced since May 22nd, two of which involve companies on the platform. Independent Bank (IBTX) is acquiring Guaranty Bancorp (GBNK) in an all stock transaction while CoBiz Financial (COBZ) is being acquired by BOK Financial (BOKF) for cash and stock. The spread was negligible on the first (2%) ( I got in late). BOKF dropped on their announcement (since upgraded at several firms) netting a spread of roughly 4.5%. On weakness I’ll continue buying the targets (no transaction fees). Once the deals complete I’ll sell the original holdings. End result should be more shares held plus the cash component (BOKF/COBZ) obtained. Now to realize the best laid plans …
Timing (Not Timing The Market)
While it is said that timing is everything, never is it truer than on hitting (or missing) ex-dividend dates. I missed some of the payout as this was announced sometime after market close (I got the notice the morning of the 19th as an order was executing):
DIVIDEND ANNOUNCEMENT: iShares Inc. on 06/18/2018 declared dividends payable on June 25, 2018 to shareholders of record as of June 20, 2018.
Note for future self: T+2 is not applicable when ex-div is one day following announcement. Or don’t cut the timing too close on ETFs. (At least Vanguard’s was a day later).
Hope everyone has a good holiday 🙂