BCE.PR.Z To Reset At 3.904%

BCE Inc. has announced:

Click for Big

The new rate of 3.904% is a little above the rate I estimated when making my recommendation, but the difference is not material. Accordingly, I reiterate that:

I recommend holders retain, or switch to, BCE.PR.Y.

For those punctilious souls out there, however, I will update the chart of Break-Even Prime Rates for this type of Strong Pair:

Click for Big

The average break-even Prime rate for the seven BCE pairs is 4.38%.

And the table of projected prices becomes:

Estimate of BCE.PR.Y (received in exchange for BCE.PR.Z) Trading Price In Current Conditions
  Assumed RatchetRate
Price if Implied Prime
is equal to
FixedFloater Bid Price Fixed Rate +3.75% 4.25% 4.75%
BCE.PR.Z 19.45 3.904%
19.29 19.80 20.30
  Actual bid on 11/14 is 19.55

Leave a Reply

You must be logged in to post a comment.