Q: An interview with the Globe & Mail about ten days ago, David LePoidevin of Canaccord Genuity said "Our most exciting trade right now is the reset, fixed-floating preferred shares, which we’re buying at an average price of about 60 cents on the dollar. The dividends were reset about three years ago when rates were 0.5 per cent. The five-year is above 3.5 per cent, so the dividend increases are stunning. Not enough people are doing the math, but you can buy something that looks like it’s unattractive today, but in two years, you’re going to have a yield that might be approaching 9 or 10 per cent." Elsewhere he clarified that he is buying only non-bank preferreds.
What is your view on this? If you agree, what rate reset preferreds would suggest? Mr. LePoidevin mentioned BCE, TRP and ENB but no specific series. The tickers above are just my guesses.