Just checked both of these plays, nice job! Looks like if you held them you made a solid return.
Distressed Debt Investing
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Just checked both of these plays, nice job! Looks like if you held them you made a solid return.
I know it has been a little while since I posted an update, so thought I would get one out there.
CHK Preferred, I can't remember if I detailed the second transaction, but I have cut my exposure in half two times on this one. I did the other transaction awhile back though. So I currently have 1/4th of the initial position. It has really been running lately, over $30/share now.
BBEP Bonds I sold for at about 20. Had some liquidity issues and needed to generate some cash so I cleared them out. Of course they are up 50% since then lol.
BTU is killing it. I only have $2k left of their bonds, but they are trading at 17 and I bought them for 4, so pretty happy with that. I locked in the majority of the position a couple months ago.
EXXI, I have two different issues, one I hold $12k of and the other I had $20k. Both I bought for around 4 cents on the dollar. The second issue I sold $5k worth the other day at about a triple to cover my costs on that position. It had a coupon payment due on Monday, and oddly enough I actually had the money deposited into the account...it is in bankruptcy though so that didn't make sense to me unless I missed a filing saying they would continue to pay for some reason. So for now I am assuming they might take it back, BUT if not, that one semi-annual payment represents a 75% return on my initial investment which is incredible. I sure hope that continues on the other issue as well! lol
Anyways, that is where I stand on everything at the moment. I have taken some time off, had some of the best and most consistent trading profits I've ever made earlier this summer (outside of these bonds) only to have a blowup a couple months ago from an incredibly stupid position sizing error. I'm still in the above positions though and looking for more plays.
Do any of you all know anything on Sandridge Energy? Somebody posted about it on another thread. I looked into them several months back but never dug in very far. From a little research tonight I found:
-Second lien outstanding $1,328m gets 85% of the company
-Unsecured outstanding $2,349m gets 15% of the company
The vote is Sept. 6th. I found it pretty surprising given their plan that the bonds are still trading at 6 cents on the dollar roughly. I need to dig in deeper. All the symbol changes on the common when these companies file BK complicates the research a bit!
CHK Preferred, I can't remember if I detailed the second transaction, but I have cut my exposure in half two times on this one. I did the other transaction awhile back though. So I currently have 1/4th of the initial position. It has really been running lately, over $30/share now.
BBEP Bonds I sold for at about 20. Had some liquidity issues and needed to generate some cash so I cleared them out. Of course they are up 50% since then lol.
BTU is killing it. I only have $2k left of their bonds, but they are trading at 17 and I bought them for 4, so pretty happy with that. I locked in the majority of the position a couple months ago.
EXXI, I have two different issues, one I hold $12k of and the other I had $20k. Both I bought for around 4 cents on the dollar. The second issue I sold $5k worth the other day at about a triple to cover my costs on that position. It had a coupon payment due on Monday, and oddly enough I actually had the money deposited into the account...it is in bankruptcy though so that didn't make sense to me unless I missed a filing saying they would continue to pay for some reason. So for now I am assuming they might take it back, BUT if not, that one semi-annual payment represents a 75% return on my initial investment which is incredible. I sure hope that continues on the other issue as well! lol
Anyways, that is where I stand on everything at the moment. I have taken some time off, had some of the best and most consistent trading profits I've ever made earlier this summer (outside of these bonds) only to have a blowup a couple months ago from an incredibly stupid position sizing error. I'm still in the above positions though and looking for more plays.
Do any of you all know anything on Sandridge Energy? Somebody posted about it on another thread. I looked into them several months back but never dug in very far. From a little research tonight I found:
-Second lien outstanding $1,328m gets 85% of the company
-Unsecured outstanding $2,349m gets 15% of the company
The vote is Sept. 6th. I found it pretty surprising given their plan that the bonds are still trading at 6 cents on the dollar roughly. I need to dig in deeper. All the symbol changes on the common when these companies file BK complicates the research a bit!
I sold HGNR for a quick profit but im still in CNX 2022s. I sold a little bit at 80 but still holding most
Yep, that is who I use. I think it is a really interesting area worth exploring. Seems to be a lot of potential at times, but I am very new to it still.
Another interesting higher profile situation is Caesars, the casino. It looks like it is going to continue to be a long drawn out fight. I just read they are trying to delay proceedings again until January. That bankruptcy really seems to be a battle between the titans, hedge funds vs private equity...
Another interesting higher profile situation is Caesars, the casino. It looks like it is going to continue to be a long drawn out fight. I just read they are trying to delay proceedings again until January. That bankruptcy really seems to be a battle between the titans, hedge funds vs private equity...
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I might just create a new thread on this (it's a long shot though), but anybody reading through here, do you know anybody at the big restructuring firms?
A little backstory on me, I'm 24, have a finance undergrad from a non target. I work as a financial analyst for one of the largest insurance brokers globally, but it's all internal corporate finance, doing forecasting for my offices, etc.
Before my current role, I started working at a credit union on the verge of going under at 19. I got to play a very active role in turning them around. I didn't know much at all at the time of course, but I had a CEO willing to try anything and together we implemented a ton of new programs, fixed a multitude of issues, and turned the credit union around to one of the top performers in its asset class (tiny but nonetheless). There's a lot more to the backstory there but can go into it at another time.
Anyways, I fell in love with the whole process. As this thread has shown, I also really enjoy looking into distressed assets. As long as I've been following stocks, I've loved looking for value in turnaround plays. It wasn't until this year that I even looked into trading the debt instead of equity and I have seen there is a lot of potential in that space.
Career wise, I don't want to be doing my job long term. I view a few potential options:
A. Insurance producer -B2B middle market @my current company
B. Restructuring Analyst-Lazard,Houlihan Lokey, etc.
C. Distressed asset hedge funds (this would more than likely require a position in restructuring first I'm assuming.
D. PE firm
Through a group I support at my work, I have potential connections to a multitude of PE firms, BUT I don't think I have near the knowledge or experience to go into an interview with a PE firm and have a chance of getting hired. I should have tried to go straight into investment banking out of my undergrad like I wanted, but that clearly didn't happen.
I mainly have been viewing a restructuring firm as a means to get into a distressed asset hedge fund later on, but I also think I'd really enjoy restructuring on its own. Just thinking out loud and looking for feedback on wtf to do with my life lol...also can of course get my MBA, but I'm putting that off unless necessary to get where I want.
A little backstory on me, I'm 24, have a finance undergrad from a non target. I work as a financial analyst for one of the largest insurance brokers globally, but it's all internal corporate finance, doing forecasting for my offices, etc.
Before my current role, I started working at a credit union on the verge of going under at 19. I got to play a very active role in turning them around. I didn't know much at all at the time of course, but I had a CEO willing to try anything and together we implemented a ton of new programs, fixed a multitude of issues, and turned the credit union around to one of the top performers in its asset class (tiny but nonetheless). There's a lot more to the backstory there but can go into it at another time.
Anyways, I fell in love with the whole process. As this thread has shown, I also really enjoy looking into distressed assets. As long as I've been following stocks, I've loved looking for value in turnaround plays. It wasn't until this year that I even looked into trading the debt instead of equity and I have seen there is a lot of potential in that space.
Career wise, I don't want to be doing my job long term. I view a few potential options:
A. Insurance producer -B2B middle market @my current company
B. Restructuring Analyst-Lazard,Houlihan Lokey, etc.
C. Distressed asset hedge funds (this would more than likely require a position in restructuring first I'm assuming.
D. PE firm
Through a group I support at my work, I have potential connections to a multitude of PE firms, BUT I don't think I have near the knowledge or experience to go into an interview with a PE firm and have a chance of getting hired. I should have tried to go straight into investment banking out of my undergrad like I wanted, but that clearly didn't happen.
I mainly have been viewing a restructuring firm as a means to get into a distressed asset hedge fund later on, but I also think I'd really enjoy restructuring on its own. Just thinking out loud and looking for feedback on wtf to do with my life lol...also can of course get my MBA, but I'm putting that off unless necessary to get where I want.
Sorry to zero in on a tiny part of your question, but the one piece of advice I have for you is regarding an MBA. For someone in your specific situation, an MBA from one of the top 7 or 8 schools is a great way to almost ensure you can move into distressed debt or restructuring, regardless of what you did in your previous career. However going to any other school would be a waste of your time/money. This isn't the answer for everyone and any good MBA program provides you the same basic level of knowledge, I'll be the first to admit it's not fair, it's not the only way to do it.. yada yada yada, but from what you've shared it certainly applies to you.
+1
Even at the top schools it's hard to break into a TIER 1 PE firm right away.
The system is fair only in that getting into a top school is a measure of the quality of the person (vs the quality of the education). Getting into a top MBA program is competitive. It means you are intelligent and have shown significant promise in your career.
I 100% agree with this. I've always been of the mindset that since I went to a non target undergrad, if I do decide to get my MBA I want to go to a top tier school if at all possible. It isn't quite top 10, but Vanderbilt is near me, the Owen School of Management. I believe they are top 25. That is a step in the right direction. I just have to figure out what is feasible. I am married with a 4 year old and the main bread winner by a factor of 2, so I will have to earn an income while in school. I'm not sure if it will negatively impact me any, but the executive MBA would more than likely be the ideal route for me at whatever school I go to. Unless they of course offer night classes (that is how I did my whole undergrad). I'm not sure if the executive type route will have a negative impact in the sense of I wouldn't be able to do a summer internship more than likely. So that is a concern, but I'm not sure if that matters so much once in the MBA program. I've heard from a few people that you want to have a job lined up entirely before the first year of the program is completed.
The internship is actually the key to the career switch. And the type of jobs you're looking for only recruit for internships at a few schools, hence the advice. If you're interested I think the admissions department at most top 25 schools will tell you where their students got internships in the past couple years and how many at each company, it's certainly something they track very closely. It really doesn't have anything to do with the education or even the piece of paper you get at the end, it's about who recruits where and if you can get your foot in the door, which those programs design their internships to do. My program didn't have a night or executive option, but my feeling is that it wouldn't work for what you want to do. I did a top full time program with two kids and had a few classmates in the same situation who weren't independently wealthy, so it's certainly doable. You get a significant amount of fellowship support, and you actually earn quite a bit during your summer internship. You end up making up the difference with student loans. That sounds scary, but the compensation you'll be making afterward ends up making those loans trivial.
Good luck in any event, your posts here show a level of intellectual curiosity combined with a willingness to jump in and try things that will probably lead you to success regardless of your path.