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RF Capital Group Inc. 5-Year Rate Reset Preferred Shares Series B (RCG.PR.B)
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RF Capital Group Inc. Cumulative Floating Rate Preferred Shares Series C (RCG.PR.C)
Q: There are many rate reset preferred shares with conversion privileges. I hold RCG.PR.B which just reset at a yield of 3.7% (on $25 face value), which is 2.89% plus the 5 year Canada government bond yield on March 1. This gives a quarterly dividend of $0.231313 per share. The rate will not reset again until March 1 2026. RCG.PR.C reset at 3.00% per annum or $0.186799 per share for the quarter, being equal to the sum of the three-month Government of Canada Treasury Bill yield determined as of March 1, plus 2.89%. The rate on the C shares will reset per the formula every quarter. The option window to convert from one version of the security to the other will close on March 16.
Given your outlook for interest rates over the next five years, which version of this security would you prefer to hold for the next five years?
Given your outlook for interest rates over the next five years, which version of this security would you prefer to hold for the next five years?
