Q: I don't quite understand your answer to Rajeev's question on CSU debentures. Does this debenture exist and what is a rights issue ? The only debenture I can find listed on the TSE is CSU.DB which show a yield of 9.5% not 13.3% . So I imagine I'm looking at the wrong one. Could you give the correct symbol for the debenture in question ? And also explain and assess CSU.DB comparing it with the one Rajeev is interested in ? Which one would you prefer as part of the fixed income section of a portfolio ? Thanks .....
5i Research Answer:
Please see this answer as well for a technical explanation and description on the rights. CSU has existing Series I debentures outstanding and these are exactly the same. The yield on the current issue shows as lower because the debentures are trading at a premium. If the subscription price is $100, the yield will be 13.3%, at least for the next year, and then it will vary with inflation. The symbol will be the same when listed. As noted, the new debentures are the same and the same that Rajeev's question referenced.