Q: hi. assuming rates stay the same, or begin to fall next year, do you like these ETF's? are they still your top picks for pref.s and bond ETF's in Canada? cheers, Chris
5i Research Answer:
Preferred shares (CPD) should start to perform better if rates are set to peak/pivot. Recent performance shows the leverage they can have when sentiment changes (CPD is up 5.8% in three months). We think it looks good today for income. CVD likely looks better, with the same impact from rates but the added kicker from the equity component of convertibles. CVD has yet to really perform, likely with lingering recession concerns. It is also small at only $92M in assets. But we would consider its outlook good.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in CPD.