Income options

With the market historical highs, It is harder to find good value stocks. On the other hand, there are not many good alternative income investments to invest in while waiting for stock prices to come down. I did find a couple that are worth sharing. Both of these have a couple things in common:

  • Decent yield.
  • Relatively safe investment.
  • Short term. At these rates, I would stay away from long term bond or preferred stock investments.

SLM Corp Series A CPI Linked Notes

  • Symbol: OSM
  • Principal Amount: $25
  • Coupon Rate: CPI Linked + 2%
  • Call Date: Not callable
  • Mature Date: 3/15/2017
  • Distribution Dates: Monthly
  • Current Price: $24.30

OSM will mature in less than 3 years. It give a CPI linked monthly dividend (currently 3-4% annually). I expect the price to move from $24.30 to $25 within in the next year. If that happens, you are looking at a nice 7% return for a year for a relatively safe investment. 

Read more about it here.

Bank of California Senior Notes

  • Symbol: BOCA
  • Principal Amount: $25
  • Coupon Rate: 7.5%
  • Call Date: 4/15/2015
  • Mature Date: 4/15/2020
  • Distribution Dates: Quarterly
  • Current Price: $25.66

Boca is giving around a $.50 dividend at end of this month. So, it is almost trading at par value. You have to be careful not to buy it at a high price since it is callable next year.

Read more about it here.

Disclosure: I am long OSM and BOCA. 

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