Investment Q&A

Q: What are the reset terms? Thanks

Q: I'm thinking of buying a position in ENB.PR.B. What's your thought on these for a long term hold? What's rate expected to be when they reset? Thanks.

Q: while the split might be beneficial for common shareholders can you comment on it's effects on the PFD's , please and thank you....the details might not be available yet but i would think one company would provide more strength to the balance sheet than two smaller ones...many thanks , in advance , for your thoughts on the matter....cheers

Q: A follow up from the previous question. I notice that SPFF has fallen dramatically over the last year - markedly more than apparently similar CEF's such as FFC-N and PDT-N. I suppose this may reflect a riskier portfolio, but the current yields are essentially the same. Any thoughts? Thanks

Q: What are your thoughts on this preferred share offering from Brookfield? It resets in June of 2016 and has a yield of 5.2%. What is the downside risk here?

Q: The common stock has gone up slightly over the past 12 months whereas the pref. has gone from near par to ~$16. I am thinking of taking a position in the pref. (already have some of the common). Can't seem to find much info. - is it a perpetual? Am I missing something? Thanks.

Q: I am baffled why this preferred is such a dog. I also own a preferred ETF (CPD) in my RRSP that is tanking.
Can you shed some light on why these are doing so badly? As well, how does the future regarding these holdings look to you?

Q: Hi Peter and team!! Happy family day weekend! My advisor has suggested investing in Algonquin Power Convertible Bonds. To tell you the truth, I never quite know whether these are a good deal or not. Here's the terms: This is a 10 year 5% convertible bond, where only 1/3 of the bond's face value is due on closing Mar1/16. The instalment receipt priced at 33.30 per 100 will earn 15% until the second instalment is due 15-90 days after approval is granted for their acquisition of the Empire District Electric Company. Interest is paid quarterly and the bonds are convertible at $10.60/ common share of Algonquin Power. This is for my RRSP. What do you think ? Is this a good investment ? Any caveats? Regards and thank you, Tamara

Q: what is the symbol of the new convertible bond? is it a good buy
thank you, J.A.P, Burlington

Q: Most if not all of the convertible bonds offering I have seen, the conversion price is at a premium to the trading price of the stock. This one is somehow unique. Can you please explain why? If I am holding the shares in a registered account wouldn't be better to hold the convertible instead (more secure and higher distribution at least for now)? Would this situation encourage arbitrage, buying the convertible and selling the stock short driving the stock price down? Do you expect that this bond to sell at a premium to the stock as soon as it hits the market?

Thanks

Q: 6:42 PM 2/9/2016
Hello Peter
Could you please comment on the Algonquin Power takeover of Empire Electric in Missouri. The deal looks very interesting to me. Algonquin are simultaneously offering 5.00% Convertible Debentures - Instalment Receipts. The Conversion price is $10.60 well below the closing price of the shares yesterday $11.54.
Could you answer these questions for me and comment on the Company and on the Debenture issue.

1. It seems very surprising to have the conversion price LESS than the market price. Why?
2. Would you prefer the Debentures or the Common shares for steady income.
3. Will the common shares trade down to the conversion price on open Feb 10th?
Many thanks.......... Paul K

Q: Regarding the just announced merger with Tahoe Resources. I currently own LSG.DB in 2 accounts. One account has to be liquidated as it is a source of retirement income. What would your suggestion be so as to try and maximize the proceeds from the sale? Also, I believe that the Change of Control provisions in the September 7, 2012 Trust Indenture (page 10) are applicable - would you be able to ascertain what the revised conversion price (if any)is or does the conversion price remain at $1.40? Thank you for your help in this matter.

Q: Would you be a seller of the Rona preferred share at this time with the takeover bid?
Thanks

Q: Hello.
Thanks for great answers....
With regard to Rona Take-over today, I have cut the Rights section from the Preffered.A Prospectus and added here.
Not often in this position, should a holder of ron.pr.a expect to see $25.00 as indicated in the prospectus? Certainly that is what I expect in reviewing the prospectus.
Thanks
Dave

Rights on Liquidation
In the event of the liquidation, dissolution or winding-up of the Company or other distribution of the assets of the Company among its shareholders for the purpose of winding-up its affairs, whether voluntary or involuntary, subject to the prior satisfaction of the claims of all creditors of the Company and of holders of shares of the Company ranking prior to the Series 6 Class A Preferred Shares, the holders of the Series 6 Class A
Preferred Shares shall be entitled to be paid and to receive an amount equal to $25.00 per Series 6 Class A Preferred Share plus accrued and unpaid dividends up to and including the date of distribution (less any tax required to be deducted and withheld by the Company) before any amount shall be paid or any assets of the Company shall be distributed to the holders of common shares or of shares of any other class of the Company ranking junior to the Series 6 Class A Preferred Shares. After payment to the olders of the Series 6 Class A Preferred Shares of the amount so payable to them, they shall not be entitled to share in any further distribution of the property or assets of the Company.

Q: What will happen with RON.PR.A following takeover by lowes

Q: Which of two would be best to hold (long term) for income, inside /outside RRSP
Thanks
Cec

Q: Good morning,

I do not understand how the bond market works and do not have any in my portfolio. In your income portfolio you have xhy. Is it necessary to have a fixed income stocks in a portfolio? Please explain me how the bond market works or do have sites in the internet that would explain it? Is the decrease in price in xhy all due to decrease of the Canadian dollar?

Thank you

Paul

Q: On the fixed income side I’ve focused on laddered GICs and increasing my exposure to prefs, lately tending to pair resets with perpetuals, as they seem to trade somewhat opposite to each other. I’ve stayed away from bonds only because I don’t want to pay above par only to take a capital loss at maturity. While one does receive a higher coupon to offset the higher price paid, taxes on the coupon are far higher than taxes saved on the capital loss. Unless I’m missing something, I can’t understand paying $103-4 to only get $100 back at maturity, and pay a higher tax rate on its higher coupon, only to receive a lower tax rate for the capital loss. Are people pulled in by the high coupon rate, not realizing that their net bottom line won’t be as attractive as the coupon rate paid?

As a retail investor, I find it difficult to find bonds at the par issue rate. Which leads me to my question, that being on Israel bonds. They seem to be issued at par, and on a 10-year basis, and pay 3.4% (with a 25k min). As part of a fixed income mix, do you see them as a good portfolio addition?

Also, if I’m missing something in the scenario I stated in reference to buying individual bonds in the secondary market, please let me know….maybe I’m wrong, maybe there’s something huge I’m missing and I should be doing it.

Thank you for all your help…

Q: I would like your suggestions for replacing the three interest income positions and the preferred shares position with dividend like equity positions. Thanks.......Tom

Q: Good Morning: I have held cpx.pr.a for some time and my cost is well below the 25.00 issue price. However, there seems to be unrelenting pressure on this pref. and I'm left wondering whether or not there is something here that I'm not aware of. Do investors/analysts wonder about the ability of Capital Power to stay in business? The current yield on the pref. in question is very high and yet it does not reset again until nearly 5 years from now. I would appreciate your comments about this pref. and whether or not you see it as a buy, sell or hold at this time. With thanks, Don