MPG-PA : Hat tip to a fellow blogger

I have recently purchased some shares of MPG-PA, largely based on a recommendation from a fellow blogger at Skeptic LLC. MPG-PA is the preferred stock of MPG Office Trust (common stock symbol MPG), a real estate investment trust specializing in office properties in California. Like many other REITs, it has been badly hit by the economic downturn, and as a result, cash flow from several properties now fails to cover its mortgages. However, as the Skeptic LLC and Variant Perceptions blogs pointed out, the non-viable properties are backed by non-recourse debt, and do not affect the value of the viable properties on MPG’s portfolio, and the market has failed to take that into account. Their arguments were so persuasive that, despite minimal knowledge of real estate pricing on my part, I was persuaded to take a position in MPG-PA. I have nothing to add beyond their excellent analyses, so I strongly urge you to read their blogs if you are interested in this position. My target for MPG-PA is for it to reach near parity (that is $28.81, with accrued dividends). The common stock is a little risky for my taste, but may be suitable for someone who is able to more finely pinpoint the value of Californian real estate.

Shortly after the series of blog articles on MPG-PA was published, the stock appreciated substantially. This piqued my interest in the market impact of small finance blogs like mine. In general, I find that the blogs which are most useful to me, the ones which actually provide actionable ideas backed by good analysis, tend to considered flaky by mainstream bloggers. These blogs violate a number of principles of good blogging. They do not publish on a regular schedule, publishing only sporadically and irregularly. They also tend to publish long articles with lots of numbers which are difficult to digest. And they are really difficult to find, what with their unpopularity and their dearth of articles. Despite this, I suspect that professional money managers actually track some of these blogs, although I have no proof of this. As for me, a benefit of starting this blog is that I sometimes enter into communications with fellow bloggers whom I then follow. I benefit from both their recommendations and the concepts they introduce during the analysis. Hopefully, I will be able to find and share with you more worthwhile blogs in the future.

Disclosure : I own shares in MPG-PA