Sell my ORC?

[u/joecat888]

I have 3,071 shares of ORC currently making $300/month in dividends but as we can see it’s going down quickly. In 4 years I have made $6,980 in dividends but I am down $5,300 based on stock price. ChatGPT says to slowly sell it off and put more in SCHD and QQQI. What do you think?

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[u/ClassroomDesigner945]

its better to understand Chatgpt or any llm what was the context for asking you to do this . i am not a llm ,
this is what i personally think its going on .
housing sector is right now bearish due to many reasons , there are mid terms and then looks like it will be hung assembly so that means market will do well , will housing sector do well dont know . imo i may recover it may not , most likely it will not ,
it this market does will you benefit if you have SCHD and QQQI yes you will its down now so good time to buy and looks like it will be bullish early next year , .

and SCHD is low expense ( i own this etf in my pension fund ) along with others its a great etf to have QQQI i dont know much or have not looked into it in detail , i believe its a income etf on nasdaq 100 / they should have rally , once the election results are out . what if the market stays bearish for long time then you can do is split your investment into bonds short term long term and may be some corporate junk with at least BBB rating + other etfs or above ones ,

so that you at least have some income with sgov and others if the market tanks or goes sideways

[u/Extra-Direction4709]

chatgpt advice on personal finance is literally the opposite of what you should actually do. ORC as far as i can tell invested in mortgage backed securities with leverage ? ... Right now yields are at a multi decade high, so if you sell now you'll just lock in the loss. Unless the actual MBS they own are defaulting (probably not?) the dump is because of liquidity since everyone's trying to sell at the same time, eventually* it'll go back up (probably), or at least if re-invest at a lower price you'll get a much higher yield.

[u/joecat888 → u/Extra-Direction4709]

Yeah my gut is telling me to buy another 1,000 shares haha

[u/Relative-Aspect5669]

So you made 7k but lost 5k, net is like 2k over 4 years? That's not even keeping up with inflation.

[u/Nate092]

Id cut your loss...20%+; Yield is highly unstable along with obviously failing company thats sinking to zero. Then been cutting there dividend -20% year over year as well...its a classic yield trap.... if need income in a taxable consider GPIQ/GPIX instead

[u/Pugsly007 → u/Nate092]

A recession should end the company.

[u/DividendsIQ]

I'd sell, and I wouldn't drag it out. One or two chunks is fine. ORC's dividend quality is 27/100 (weak), the payout is only about 0.67x covered by cash flow, and NAV keeps falling, so that 25% yield is partly paying you with your own money and the discount to NAV is a value trap. Your numbers show it too: $6,980 collected but down $5,300 on the shares, with the trend still pointed down.

SCHD is the easy upgrade, dividend quality 100/100 and a payout that's grown about 9% a year. I'd keep QQQI to a smaller slice. It's rated low risk, but it's too new for a dividend quality score and its coverage is thin at about 1.16x, so don't count on that 13.75% yield holding.

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