tag:blogger.com,1999:blog-6321089372587128676.post8611306635146941347..comments2023-10-17T10:01:00.917-04:00Comments on Distressed Debt Investing: BAC versus the ABXUnknownnoreply@blogger.comBlogger8125tag:blogger.com,1999:blog-6321089372587128676.post-81846109878932439422011-07-26T12:32:08.272-04:002011-07-26T12:32:08.272-04:00Looking forward to more of your thoughts on BAC.Looking forward to more of your thoughts on BAC.Joshua Wallishttps://www.blogger.com/profile/16147838003431656851noreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-34115554680233004172011-07-19T22:38:02.514-04:002011-07-19T22:38:02.514-04:00Post the news of the BAC settlement with many larg...Post the news of the BAC settlement with many large investors, the ABX and BAC relationship diverged. That is because it is expected that Subprime securities (which make up the ABX) will benefit more then other MBS securities from lawsuits (which are similar in effect to the BAC lawsuit) which previously moved closer to in sync. The settlement dollars go from BAC and into deal cashflow waterfalls. Notice CIM vs ABX as well.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-83034416531759315132011-07-19T18:33:42.023-04:002011-07-19T18:33:42.023-04:00Why not buy the 2019 TARP warrants instead? The st...Why not buy the 2019 TARP warrants instead? The strike price of $13.3 is adjusted down for dividends.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-65874631564265021182011-07-19T08:57:59.433-04:002011-07-19T08:57:59.433-04:00The one negative to buying leaps is the impact of ...The one negative to buying leaps is the impact of a big dividend increase - you participate in a re-pricing of BAC but any time premium goes awayAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-42011226747564850542011-07-19T06:58:28.257-04:002011-07-19T06:58:28.257-04:00BAC is levered 40 to one the up tic in ABX doesn&#...BAC is levered 40 to one the up tic in ABX doesn't matter as BAC has been toast for a year kept on life support by the FEDAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-68166302236181979002011-07-18T23:57:41.453-04:002011-07-18T23:57:41.453-04:00I would respectfully disagree. -- Eurozone risk as...I would respectfully disagree. -- Eurozone risk as disclosed on the call on Friday was $22B, of which, only a small portion was related to sovereigns. Mortgages are a far larger problem than Citi's sovereign risk. Further, Citi's overseas businesses are a source of strength, not weakness.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-6956816012372696572011-07-18T23:31:58.876-04:002011-07-18T23:31:58.876-04:00$c has larger international and Eurozone risk whic...$c has larger international and Eurozone risk which I would indicate is less defined than the mortgage risk.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-74268708749440312682011-07-18T23:09:43.502-04:002011-07-18T23:09:43.502-04:00Why not Citi instead of BofA? Both trade at close ...Why not Citi instead of BofA? Both trade at close to the same TBV multiple -- maybe BofA a little cheaper, but Citi doesn't have many of the same risks, no?Anonymousnoreply@blogger.com