Investment Q&A

Q: I have been looking to add some exposure to preferred shares. In the USA there is a fund with the ticker PFFA which is trading well below par which makes the yield just shy of 10 per cent. If, or better said when yields start falling (And I hope that doesn't happen too soon.) this yield would be even enticing and the fund should move up in price closer to par which would give some capital appreciation. Also the CAD is nearing 75 cents which I see as on the upper end of its trading range. Am I missing something? It has a safe (ish) yield, potential for capital appreciation and is in USD all of which I like. Merry Christmas and a Joyful start to 2024.

Q: Hello 5i,

The turnaround that began in early November on many preferred stocks already seems to be reversing on some of them and heading back towards their lows. Is there a logical reason for this? (My question concerns perpetual preferreds, here are some examples - MFC.PR.C or FTS.PR.F)

Any information is welcome.

Thank you

Q: There is very little information about about this issue with very high yield office property investment. In general office property REITs are loosing ground with asset valuation. How do one get to analyse it other than its name sake being a part of Brookfield managed manager.

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

Q: Are preferred shares treated the same as stocks,in that you still get the interest or dividend if you sell it on the ex dividend/interest payment date??

Q: Issued at $25 and now trading at $12.10 for a yield of over 13%. This seems to imply there is a good chance Brookfield may walk away from these securities? Your thoughts?

Thanks

Q: Today Brian asked about the dividend rate for this pref. share.
You have indicated that the rate is .307
I believe the correct rate is 6.525%.
Can you please explain.
Thanks

Q: Regarding Brian’s question:
I can’t find a press release, but I think this issue was in fact scheduled to reset on Dec 1 , 2023
Pembina website shows a dividend rate of 6.525%, presumably based on par at $25. This would run until Dec 1, 2028.
Adds up to about $1.63 per annum or $.4078 quarterly.
Stock closed at $20 so if bought at that price would effectively yield about 8.16%.
I apologize if my math or info is incorrect, but this is worth rechecking I think.

Q: Ref Brian question on Friday, Dec 1 :

``The annual dividend rate for the Series 1 Shares for the five-year period from and including December 1, 2023, to, but excluding, December 1, 2028, will be 6.525 percent, being equal to the five-year Government of Canada bond yield of 4.055 percent determined as of today plus 2.47 percent, in accordance with the terms of the Series 1 Shares.`` .

According to me, the dividend should now be 0.4075 …

Q: Please advise what is the current dividend on this stock, as it has just reset.

Q: ALA announced Nov21 the redemption of ALA.PE . Yet these preferred had a big jump 2 weeks earlier. ALA.PG, to be reset in 2024, also jumped. Was it the Earning report or the Note offering that would trigger such a move. Or a crystal ball ? The stock itself was flat. Thanks,

Q: Hello 5i team,
CPD has jumped up a bit in the past few weeks. Just curious about what is pushing the preferred ETF up? Is it the assumption that rate increases have halted(slowed down)?
Andrew

Q: Hi could you please comment on the Brookfield Office Property Inc, 6.359 Cum.Min RR CLAAA PFD S11 . It looks like a great buy with a very high projected dividend your thoughts please

Q: I am retired and a dividend investor in corporations which receive the dividend tax credit as any investments would be in an unregistered account. Would you think it’s timely to purchase some preferred shares for a 5 percent position, doing so over the next couple of months. If you think it is worthwhile, please provide 4 or 5 preferred shares that you would recommend.

Capital preservation and liquidity is important and unless the dividend is greater than 7 percent I would assume you would be better off just investing in some blue chip large cap companies with high yields where there is a chance for more capital appreciation. ALSO I would like you to consider minimum rate reset preferred shares that would reset within the next 12 months and if they reset today what would the yield be.

Thanks BRIAN

Q: Which do you prefer to invest today: TLT or preferred stock ETFs. For preferred stock ETFs, could you suggest a few? Please explain the reason. Thank you.

Q: Could you please tell me what is the risk of buying this preferred today? I believe it resets in Sept 2027. Rates will likely be lower then, but what would the yield and price look like then relative to today's value and rate. I'm looking for USD income but with a dividend tax credit benefit. Any other suggestions (MG, NTR, QSR?) instead of this strategy? Thanks

Q: What are you thoughts on this preferred share?

Q: This Brookfield Office preferred is trading with an over 12% yield and if I understand correctly is resetting on December 31, 2023 at a higher rate. Why is it trading down lately with rates so high and resetting so soon. Knowing that it is higher risk would you consider it a buy for its high yield. Also could it be called for a large capital gain on Dec 31.

Q: I like these two preferred shares but can you tell me who is on the hook to pay the dividends, Is it Edison and Charter. Hate to be cought off guard if things really head south. As always thank for your help!

Q: I have read your comments on ECN. But with the debentures (ECN.DB.B) yielding over 9% and the preferreds (ECN.PR.C) over 13% someone hold my hand!