Q: What is your read on this preferred? Would they behave similarly to bonds in regards to capital appreciation?
5i Research Answer:
We would be quite comfortable here with credit quality and dividend security. Generally, preferreds do correlate with bonds, up to a point. This preferred is a re-set preferred, with the next reset April 2024. Thus, if rates are lower then, then the dividend will be adjusted, and this may limit its correlation to bonds.