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
One of the reasons why CPD has jumped is due to speculation regarding interest rates peaking and now more likely to fall. The Bank of Canada recently mentioned that interest rates may be high enough, and if this is the case, the markets as a whole will benefit. Another reason is provided in the Fall 2023 Economic Statement. An exception to the Budget 2023 measure to deny the dividend deduction under the Income Tax Act for dividends received by financial institutions on shares that are marked to market was proposed. The proposal is an exception for dividends received on taxable preferred shares which would apply to dividends received on/after Jan. 1, 2024. These factors likely created the jump in CPD and preferred ETFs.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in CPD.