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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: Hello Peter, Like most of us, are concern about the effect of the coming rate increases. How safe will the above preferred shares be, would you consider them as good choices for income and safety? Also, can you suggest equivalents in the Canadian market? Many thanks for your valued advise, J.A. P. Burlington
Read Answer Asked by Joseph on July 10, 2017
Q: Hi Peter and Team,

Could you please give me your thoughts on preferred shares in general given the current interest rate environment and the pending rate hike by BOC in about a week's time. Please also provide some names of ETFs of preferred stocks in both Canadian and US denominations.

Cheers,
Harry
Read Answer Asked by Harry on July 10, 2017
Q: I own Series 2 Adjustable Rate Preferred Shares. The company has given notice that these shares can be converted on a one-for-one basis into Series3 Preferred Shares. Would it be more advantageous for me to keep the Series 2 Adjustable Rate Preferred Shares or convert them into the Series 3 Preferred Shares?
Read Answer Asked by Heidrun on June 28, 2017
Q: Good morning
I purchased TD preferred rate reset shares TD.PF.G at $25 par in the IPO just over a year ago. The shares now trade at about $27. The initial dividend was set at 5.5% until April 30 2021 at which date either the shares will be redeemed at par or the dividend reset at the 5 year Bank of Canada rate plus 4.66%. The renewal rate seems to be quite high so I suspect the shares will be redeemed in 2021. If that is the case, the yield to maturity is approximately 3.1%, so I am considering selling and moving on. Is this analysis flawed?
David
Read Answer Asked by David on June 16, 2017
Q: They are offering convertible debentures paying 5.25% - attractive since I think by 2024 ALC could be much higher than $13. However, the conversion is at more tan $20 per share. The extra security would mean giving up more than 50% upside. Does this seem an usually high conversion price? Do you think it is an attractive offering?
Read Answer Asked by John on June 02, 2017
Q: Would you mind commenting $75 million covertible debenture issue. I think the market likes the issue. It appears the new debenture will be replacing an expiring debenture at a lower interest rate so I suppose that should be good for the company's bottom line. The news release states the conversion price is $21.15 per share. Pardon my ignorance but how exactly does the conversion work? Does a debenture act in a similar fashion to a bond? If interest rates go up does the price of debenture go down? How would the debenture act in effect of a market crash?
Thank you,
Jim
Read Answer Asked by James on June 02, 2017
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