This is a quick stream of consciousness post on one issue I have noticed in the preferred share universe, Thomson Reuters Corp, Series II (ticker TRI.PR.B). I believe this an issue left over from Thomson Corp days (pre-Thomson/Reuters tie-up). I actually think that the majority of folks participating in floaters have no clue what they own. They look at current ytm, extrapolate, take the plunge and then pay the price after. Take Thomson Reuters preferred B. This is basically the equivalent of cheap debt on the part of the issuer. The specs: Floating rate preferred, pays 70% x Canada prime x $25 (par) 6 m shares o/s Callable anytime at par Here’s the chart through current: Absolutely ridiculous There’s only 6M shares o/s, so this thing is highly illiquid. This will trade in conjunction with whatever Canada prime does (and expectations over the future direction of prime). Here’s a historical ch...
Random thoughts about investing