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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: My earlier question on ala.pr.u was not answered. Can you please advise?
I am resending the question:

ala.pr.u is a rate reset preferred share in US denomination. The rate will reset in 2017 at 3.58% plus the 5 year US Government bond.
While the steep decline of the Canadian Preferred rate reset shares is understandable because of declining Canadian interest rates, the decline of ala.pr.u from $25 a year ago to $17.30 today is puzzling.
Can you please provide some insight as to why this US dollar preferred share has lost 40% of its value if the reset rate will depend on the 5 year US Government bond which is 1.46% today vs .57% for the respective Canadian rate??
Thanks
Read Answer Asked by Terry on January 20, 2016
Q: Good Afternoon
Would you consider the new PPL minimum rate reset selling at $1.00+ below issue a good TSA income investment, or are there previous utility issues selling at greater discounts without as favourable a reset more appropriate?
Thanks to all
Read Answer Asked by Warren on January 20, 2016
Q: Supposing the BOC drops the overnight rate on Wednesday by 25 basis points. ZPR would go South. CBO and VSC go North. XBB goes North. Am I correct?

Thanks
Read Answer Asked by roland on January 18, 2016
Q: current price for this preferred stock is 9.75 with 5% dividend if fund winds down; the original issue price of 10.00 per unit will be paid to the share holder. is this correct or am i missing something. i have shares in dgs.pr , ftn.pr & dfn.pr how would you rate these funds as to saftey of dividend &repayment of orginal issue price
Read Answer Asked by neil on January 18, 2016
Q: You last commented on these prefs in Apr. Since then they have declined a lot further and now appear attractive for at least yield. Are you still comfortable with the credit rating of the company in today's environment?
Thanks
Read Answer Asked by angus on January 18, 2016
Q: I see that DFN is dropping like the rest of the market. Rob Carrick from The Globe and Mail is recommending preferreds in the form of CPD. Are preferreds in any form a good safe haven right now?

Vern
Read Answer Asked by Vern on January 14, 2016
Q: I am finally looking at converting some of my RIF to bonds in order to get a stable income to add to pension. The funds will be divided equally between CBO,XBB,XHY. I have not invested in bond funds before and would really like to better understand what affects the price movement of these three particular funds. I have done a browse on Moneysaver past issues but can't find anything that really gives me the info I'm looking for. Could you give a quick explanation or maybe suggest some alternative resource ?
Many thanks
Read Answer Asked by Alexandra on January 13, 2016
Q: Hi Peter & Co.,
I am considering taking a position in Sunlife perpetual preferred shares (series A,B,C or D). Current yield is about 5.8% vs. 4% on the common shares. It seems to me that gov't bond yields in Canada will be low for quite some time to come, and may even head lower should Mr. Poloz reduce the prime rate this year. These shares are already trading 10% or so below their call price, which should help if the company eventually calls them. What do you think of this issue as a long-term hold for income? Also, do you know what the rating is on these shares?
Thanks,
Brian
Read Answer Asked by Brian on January 13, 2016
Q: I HAVE SOLD SOME OF MY PREFERRED AND HAVE 3 LEFT: IAG.PR.G, PWF.PR.S AND BCE.PR.K. DO YOU THINK THEY HAVE ANY UP VALUE OR SHOULD I GET RID OF THEM AND PICK UP THE NEW GENERATION PREFERRED SHARES WHICH HAS A RESET BASE. (EG ALA.PR.I) OR CONTINUE HOLDING THESE INVESTMENTS.
Read Answer Asked by judy on January 12, 2016
Q: I have a small position in this pref in a registered account. I've held it for almost a year and am down on it. I was wondering if I shouldn't add to it at this time given I have sufficient cash in that account?
Ron
Read Answer Asked by Ronald on January 11, 2016
Q: Hello
I'm interested in knowing your thoughts on good investment options for asset preservation but still with some income growth potential.
Read Answer Asked by Giovanni on January 11, 2016
Q: Are there pros/cons when buying callable vs non-callable bonds where the effective maturity is the same?
Read Answer Asked by Brian on January 08, 2016
Q: hi, what do think about CPD? is now a good time to buy and hold...
Read Answer Asked by chris on January 08, 2016
Q: Could I please have an update on XHB, Blackrock's Hybrid Corp Bond Index. I asked about this ETF last August and it has since fallen in value quite substantially. On the other hand, the laddered Corp Bond Index from Blackrock, CBO, has held up rather well over the same time frame. Would CBO be preferable over XHB? Or should bond funds be avoided at this volatile time? I am currently sitting on 30% GIC's and 70% cash - no equities whatsoever. Thanks for your opinion.
Read Answer Asked by Paul W on January 07, 2016
Q: Hello
earlier question about the enb pref.......ticker is PF.G

The dividend is initially fixed until September 1, 2020. On September 1, 2020 and on September 1st every five years thereafter the dividend will be re-set and fixed at a rate that equals the sum of the Government Of Canada Yield (GCAN5YR) plus 2.68%.
Read Answer Asked by David on January 06, 2016
Q: Good Morning Your opinion plse on what to do
A. Sell before it gets worse
B. Wait for a pick up then sell
C. Be patient wait for interest rates to rise over the next 4 yrs and maybe break even
I own 600 shares of each purchased at issue at 25$
Read Answer Asked by Marcel on January 06, 2016
Q: I am intrigued by the yield offered on these two Pfd's ...around 7 % with resets 4 & 5 years out at approx 4.8 % (C) & 5.4 % (G) plus 5 yr Cda Rate...Can you give me your opinion, please and thank you , as to the credit worthiness of these two pfd's ...also if you know there credit rating...and whether you would feel comfortable buying them at these levels with the view of holding them longer term...Many thanks
Read Answer Asked by Cam on January 05, 2016
Q: I am interested in purchasing some bonds for fairly high yield with an approx. 3 year term. Your recommendations would be appreciated. and possibly some advise on the do's and dont's of holding them
Read Answer Asked by kenneth on January 04, 2016
Q: Is it advantageous to convert shares to series 6 by the end of January. What happens to the dividend if I just hold the stock long term.
Read Answer Asked by Gino on December 31, 2015
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