Archive for June, 2007

MAPF Portfolio Composition: June 29, 2007

Saturday, June 30th, 2007

Well, if you thought portfolio composition changed dramatically from April 30 to May 31, just take a gander at the June 29 composition!

MAPF Sectoral Analysis 2007-6-29
HIMI Indices Sector Weighting YTW ModDur
Ratchet 0% N/A N/A
FixFloat 0% N/A N/A
Floater 0% N/A N/A
OpRet 0% N/A N/A
SplitShare 25% 4.62% 6.15
Interest Rearing 0% N/A N/A
PerpetualPremium 42% 5.25% 4.26
PerpetualDiscount 36% 5.06% 15.34
Scraps 1% 4.19% 5.75
Cash -3% 0.00% 0.00
Total 100% 5.16% 8.68

Sharp-eyed readers will observe that the “total” reflects the un-leveraged total portfolio (i.e., cash is included in the portfolio calculations and is deemed to have a duration and yield of 0.00.), and may make their own adjustments to reflect interest. The average YTW on the securities-only portion of the portfolio, for instance, is actually about 5.01% … it is the 3% leverage factor that brings it up to 5.16%. MAPF will often have relatively large cash balances to facilitate trading.
These sharp-eyed readers will also note, with a certain amount of glee, that the percentages do not add up to exactly 100% in the above or the following tables. This is due to rounding. You know something? Sharp-eyed readers really bug me.
Credit distribution is:

MAPF Credit Analysis 2007-6-29
DBRS Rating Weighting
Pfd-1 35.3%
Pfd-1(low) 29.2%
Pfd-2(high) 13.0%
Pfd-2 25.0%
Cash -2.6%

Liquidity Distribution is:

MAPF Liquidity Analysis 2007-6-29
Average Daily Trading Weighting
<$50,000 0.9%
$50,000 – $100,000 25.8%
$100,000 – $200,000 24.5%
$200,000 – $300,000 27.4%
>$300,000 23.9%
Cash -2.6%

MAPF is, of course, Malachite Aggressive Preferred Fund, a “unit trust” managed by Hymas Investment Management Inc. Further information and links to performance, audited financials and subscription information are available on the fund’s web page. A “unit trust” is like a regular mutual fund, but is sold by offering memorandum rather than prospectus. This is cheaper, but means subscription is restricted to “accredited investors” (as defined by the Ontario Securities Commission) and those who subscribe for $150,000+. Fund past performances are not a guarantee of future performance. You can lose money investing in MAPF or any other fund.

A discussion of June’s performance is available here.

MAPF Performance: June, 2007

Saturday, June 30th, 2007

Malachite Aggressive Preferred Fund has been valued for June, 2007, month-end. The unit value is $9.3114, after a dividend distribution of $0.066279. Returns over various periods are:

MAPF Returns to June 29, 2007
One Month +0.56%
Three Months -1.59%
One Year +5.25%
Two Years (annualized) +4.90%
Three Years (annualized) +6.51%
Four Years (annualized) +9.82%
Five Years (annualized) +9.28%
Six Years (annualized) +10.28%

Returns assume reinvestment of dividends, and are shown after expenses but before fees. Past performance is not  a guarantee of future performance. You can lose money investing in Malachite Aggressive Preferred Fund or any other fund. For more information, see the fund’s main page.

Well, that’s the worst quarter for the fund since 2Q04. So why am I happy? Let’s have a look at how the Claymore ETF did on the month – regular readers of this blog will be familiar with this fund, which is a useful passive benchmark.

CPD Return, June 2007
Date NAV Distribution Return for period
May 31, 2007 $19.44    
June 26 $18.97 $0.198800 -1.40%
June 29, 2007 $18.97   0.00%
Time-Weighted, June -1.40%

Diversified Preferred Share Trust, DPS.UN on the Toronto exchange, has the anti-social practice of not publishing month-end NAV numbers, but we’ll do what we can: 

DPS.UN NAV Return, June-ish 2007
Date NAV Distribution Return for period
May 30, 2007 $22.55    
June 27 $21.95 $0.30 -1.33%
Time-Weighted, June-ish -1.33%
CPD had an NAV of $19.48 on May 30 and $19.01 on June 27. The pre-June stub period return for CPD was therefore -0.21%, and the end-June stub-period return was also -0.21%. We may infer that CPD’s NAV return for the May 30-June 27 period was almost identical to its calendar month return of -1.40%, after all fees & expenses and thus that CPD marginally underperformed DPS.UN on an NAV-to-NAV basis.

So Malachite, after expenses but before fees, beat the passive alternative (after expenses & fees) by nearly two percent in a single month.

It is, of course, unpleasant to lose money. A sensible investor will expect such things to happen occasionally and will not attempt to time the market, but will make an overall asset allocation based on reasonable medium term expectations of returns. The asset allocation should be reviewed on a regular basis, of course, to ensure that changes in expectations and investment needs are reflected in the portfolio, but a rationally active investor will attempt to outperform within each relatively homogeneous asset class without market timing. From this perspective, an outperformance of nearly 2% in a bad month is just as good as the same outperformance in a good one.

While June 29 BMO-NB50 index numbers are not yet available, I expect to see a return of roughly -5.25% on the quarter … which makes the MAPF return (after expenses, before fees) of -1.59% look pretty good! If the fund can outperform at the rate of about 3.6% per quarter forever … well, I’d be very happy, but I’m not going to bet on it! I’m happy when I can earn my fees by delivering net out-performance within the asset class to unitholders. 

Trading during the month was frantic, as I predicted last month. Shares with a book value in excess of 90% of the total book value at the end of May were sold and replaced with new purchases. This incurred commission expenses of about 0.50% , so those who have been hoodwinked into the belief that the Trading Expense Ratio is an important number will certainly not wish to invest in the fund! I suspect that the BCE/Teachers deal and the proposed redemption of the BCE Preferreds at a very high price relative to current market will lead to continued turmoil in the market and lots more trading in July … but we will see!

The noted BCE/Teachers deal may be expected to boost the market price of BCE preferreds considerably when markets re-open on July 3 – and MAPF doesn’t hold any! Such is life … as I’ve noted before, in the absence of good information about a deal (and remember, preferred shareholders haven’t actually seen any Teachers’ money yet) BCE preferreds are just a crapshoot on credit … and MAPF doesn’t play craps! The underlying philosophy of the fund continues to be that investment-grade preferred shares are bundles of cash-flows trading at fluctuating prices and that money can be made by weighing these bundles of cash-flows to determine value based on reliable public information and trading to exploit inefficiencies – not by taking a wild guess and hoping to strike the jackpot.

If the BCE Prefs move to within “arbitrage difference” of the offering prices disclosed in the BCE press release, I expect DPS.UN & CPD to outperform MAPF over the next month. However, if something should happen to the deal … like, maybe, Telus moving in, or some private equity guys coming along with a credible hostile bid, negatively affecting perceptions of the BCE prefs’ quality … maybe they won’t. But you will not see MAPF making bets like that! Once credit gets called into question, I start getting very nervous! At worst, I do not anticipate that MAPF underperformance due to BCE will exceed the outperformance in the second quarter that is largely due to not holding in on the downside. Note that BCE prefs represent about 7-10% of the value of the passive funds.

The distribution of dividend income for the quarter was small, which is most gratifying. Given that the fund now has a realized capital loss on the year to date, it is tax-efficient to emphasize capital gains (or reduced capital losses!) over receipt of dividend income and some trading took advantage of this … particularly since it seemed that RBC had a client pursuing an aggressive dividend capture strategy! I don’t have a lot of control over the capital gain/dividend split, but HIMIPref™ does account for the difference in taxation and potential trades are nudged a little.

Portfolio characteristics as of the end of June are discussed in another post.

Best & Worst Monthly Performances: June, 2007

Saturday, June 30th, 2007

These are total returns, with dividends presumed to have been reinvested at the bid price on the ex-date. The list has been restricted to issues in the HIMIPref™ indices.

Issue Index DBRS Rating Monthly Performance Notes
 ELF.PR.G PerpetualDiscount  Pfd-2(low) -6.73%   Now with a pre-tax bid-YTW of 5.40% based on a bid of 22.06 and a limitMaturity.
 IAG.PR.A PerpetualDiscount  Pfd-2(high) -5.69%  Now with a pre-tax bid-YTW of 5.13% based on a bid of 22.50 and a limitMaturity.
 BNS.PR.M PerpetualDiscount  Pfd-1 -5.10%   Now with a pre-tax bid-YTW of 5.14% based on a bid of 22.35 and a limitMaturity.
 MFC.PR.B PerpetualDiscount  Pfd-1(low) -4.85%   Now with a pre-tax bid-YTW of 4.96% based on a bid of 23.55 and a limitMaturity.
 ELF.PR.F PerpetualPremium (until after rebalancing!)  Pfd-2(low) -4.84%   Now with a pre-tax bid-YTW of 5.39% based on a bid of 24.60 and a limitMaturity.
 …  … …  … 
 BAM.PR.B Floater  Pfd-2(low) +1.26%   
 CM.PR.P PerpetualPremium  Pfd-1(low) +1.31%   Now with a pre-tax bid-YTW of 5.02% based on a bid of 25.50 and a call 2012-11-28 at 25.00.
 BCE.PR.S Ratchet  Pfd-2(low) [Under Review – Negative] +1.32%   
 BAM.PR.G FixedFloater  Pfd-2(low) +1.62%   
 LBS.PR.A SplitShare  Pfd-2 +3.10%   Now with a pre-tax bid-YTW of 4.24% based on a bid of 10.55 and a hardMaturity 2013-11-29 at 10.00

Teachers Agrees to Buy BCE: Plans to Acquire Preferreds!

Saturday, June 30th, 2007

BCE has announced:

that the company has entered into a definitive agreement for BCE to be acquired by an investor group led by Teachers Private Capital, the private investment arm of the Ontario Teachers Pension Plan, Providence Equity Partners Inc. and Madison Dearborn Partners, LLC. The all-cash transaction is valued at C$51.7 billion (US$48.5 billion), including C$16.9 billion (US$15.9 billion) of debt, preferred equity and minority interests. The BCE Board of Directors unanimously recommends that shareholders vote to accept the offer.

Under the terms of the transaction, the investor group will acquire all of the common shares of BCE not already owned by Teachers for an offer price of C$42.75 per common share and all preferred shares at the prices set forth in the attached schedule.
….
                            SCHEDULE A
                   BCE PREFERRED SHARES – PURCHASE PRICES

    The cash considerations payable to the holders of the preferred shares
    are as follows:

    ————————————————————————-
        First Preferred Shares               Consideration Per Share
    ————————————————————————-
              Series R                             $25.65 (*)
              Series S                             $25.50 (*)
              Series T                             $25.77 (*)
              Series Y                             $25.50 (*)
              Series Z                             $25.25 (*)
              Series AA                            $25.76 (*)
              Series AC                            $25.76 (*)
              Series AE                            $25.50 (*)
              Series AF                            $25.41 (*)
              Series AG                            $25.56 (*)
              Series AH                            $25.50 (*)
              Series AI                            $25.87 (*)
    ————————————————————————-
    (*)Together with accrued but unpaid dividends to the Effective Date.

I’m astounded. I don’t understand why they would pay so much for the preferreds … but there is a note in the press release that states:

The transaction will be completed through a plan of arrangement, which will require the approval of two-thirds of outstanding common and preferred shares, voting as a class.

I will be fascinated to learn more of the legal intricacies which make this a viable option for the purchasers! As it is, it looks like all my gloomy prognostications will turn out wrong. Although, mind you, the preferred shareholders don’t actually have cash money in their pockets yet – and there have been tears shed over similar offers.

 

BCE has the following preferred shares outstanding: BCE.PR.A, BCE.PR.C, BCE.PR.E, BCE.PR.F, BCE.PR.G, BCE.PR.H, BCE.PR.I, BCE.PR.R, BCE.PR.S, BCE.PR.T, BCE.PR.Y & BCE.PR.Z

 

June 29, 2007

Saturday, June 30th, 2007

Another quarter’s been put to bed! Today was a strong day for bonds and a good day for bond traders, who quit work early in the afternoon. I’ve never quite understood how they get away with that, but they do put in pretty long hours.

Note that these indices are experimental; the absolute and relative daily values are expected to change in the final version. In this version, index values are based at 1,000.0 on 2006-6-30
Index Mean Current Yield (at bid) Mean YTW Mean Average Trading Value Mean Mod Dur (YTW) Issues Day’s Perf. Index Value
Ratchet 5.71% 5.78% 26,472 14.41 2 +0.0442% 960.3
Fixed-Floater 5.65% 5.98% 139,701 14.31 7 -0.4211% 894.4
Floater 4.83% 1.65% 86,666 5.64 3 +0.1898% 1,049.1
Op. Retract 4.83% 4.02% 84,365 3.14 17 +0.1554% 1,021.3
Split-Share 5.04% 4.60% 148,139 4.16 15 +0.1200% 1,044.7
Interest Bearing 6.77% 6.95% 82,512 6.13 4 +0.3422% 1,031.4
Perpetual-Premium 5.42% 5.12% 149,690 7.42 34 +0.1280% 1,022.4
Perpetual-Discount 5.07% 5.10% 483,253 15.33 29 +0.1450% 965.8
Major Price Changes
Issue Index Change Notes
BCE.PR.G FixFloat -2.0277%  
ELF.PR.G PerpetualDiscount -1.5116% Now with a pre-tax bid-YTW of 5.40% based on a bid of 22.06 and a limitMaturity.
BCE.PR.Z FixFloat -1.5111%  
CFS.PR.A SplitShare +1.0204% Now with a pre-tax bid-YTW of 4.47% based on a bid of 9.90 and a hardMaturity 2012-01-31 at 10.00.
BNS.PR.M PerpetualDiscount +1.1312% Now with a pre-tax bid-YTW of 5.14% based on a bid of 22.35 and a limitMaturity.
IAG.PR.A PerpetualDiscount +1.3514% Now with a pre-tax bid-YTW of 5.13% based on a bid of 22.50 and a limitMaturity.
BSD.PR.A InterestBearing +1.5086% Now with a pre-tax bid-YTW of 7.08% based on a bid of 9.42 and a hardMaturity 2015-3-31 at 10.00.
BCE.PR.A FixFloat +1.8981%  
Volume Highlights
Issue Index Volume Notes
BNS.PR.K PerpetualPremium (until the rebalancing takes effect!) 58,770 Now with a pre-tax bid-YTW of 4.95% based on a bid of 24.20 and a limitMaturity.
RY.PR.A PerpetualDiscount 19,497 Now with a pre-tax bid-YTW of 5.03% based on a bid of 22.35 and a limitMaturity.
POW.PR.D PerpetualDiscount 18,345 Now with a pre-tax bid-YTW of 5.22% based on a bid of 23.96 and a limitMaturity.
NA.PR.L PerpetualPremium (until the rebalancing takes effect!) 17,700 Now with a pre-tax bid-YTW of 5.06% based on a bid of 24.25 and a limitMaturity.
BCE.PR.C FixFloat 14,890  

There were thirteen other $25-equivalent index-included issues trading over 10,000 shares today.

June 28, 2007

Friday, June 29th, 2007

Very sorry … due to month-end scheduling difficulties, the report for June 28 will be delayed. I hope to have everything caught up by the end of the day.

Later…

Note that these indices are experimental; the absolute and relative daily values are expected to change in the final version. In this version, index values are based at 1,000.0 on 2006-6-30
Index Mean Current Yield (at bid) Mean YTW Mean Average Trading Value Mean Mod Dur (YTW) Issues Day’s Perf. Index Value
Ratchet 5.71% 5.78% 27,182 14.42 2 +0.1107% 959.9
Fixed-Floater 5.63% 5.94% 138,991 14.37 7 -0.0904% 898.2
Floater 4.84% 2.64% 86,065 5.85 3 -0.0262% 1,047.1
Op. Retract 4.83% 4.08% 85,381 3.57 17 +0.0047% 1,019.8
Split-Share 5.04% 4.63% 151,439 4.05 15 -0.0096% 1,043.5
Interest Bearing 6.80% 7.00% 84,576 6.13 4 -0.4232% 1,027.9
Perpetual-Premium 5.43% 5.14% 149,443 7.81 34 +0.1047% 1,021.0
Perpetual-Discount 5.07% 5.11% 492,114 15.32 29 -0.0920% 964.4
Major Price Changes
Issue Index Change Notes
BSD.PR.A InterestBearing -2.8272% Now with a pre-tax bid-YTW of 7.32% (as interest) based on a bid of 9.28 and a hardMaturity 2015-3-31 at 10.00.
BNS.PR.M PerpetualDiscount -2.4713% Now with a pre-tax bid-YTW of 5.20% based on a bid of 22.10 and a limitMaturity.
BCE.PR.Z FixFloat -2.1739%  
BCE.PR.A FixFloat -1.2797%  
FIG.PR.A InterestBearing +1.0341% Now with a pre-tax bid-YTW of 6.68% based on a bid of 9.77 and a hardMaturity 2014-12-31 at 10.00.
CU.PR.A PerpetualPremium +1.0576% Now with a pre-tax bid-YTW of 5.17% based on a bid of 25.80 and a call 2012-3-31 at 25.00.
ELF.PR.G PerpetualDiscount +2.0225% Now with a pre-tax bid-YTW of 5.33% based on a bid of 22.70 and a limitMaturity.
Volume Highlights
Issue Index Volume Notes
RY.PR.A PerpetualDiscount 116,820 Now with a pre-tax bid-YTW of 5.06% based on a bid of 22.25 and a limitMaturity.
RY.PR.E PerpetualDiscount 110,800 Now with a pre-tax bid-YTW of 5.06% based on a bid of 22.50 and a limitMaturity.
SLF.PR.D PerpetualDiscount 105,360 Now with a pre-tax bid-YTW of 5.03% based on a bid of 22.21 and a limitMaturity.
BMO.PR.G OpRet 79,494 Now with a pre-tax bid-YTW of 4.80% based on a bid of 25.11 and a softMaturity 2008-5-24 at 25.00.
BNS.PR.J PerpetualPremium 23,100 Now with a pre-tax bid-YTW of 4.91% based on a bid of 25.40 and a call 2013-11-28 at 25.00.

There were eleven other $25-equivalent index-included issues trading over 10,000 shares today.

June 27, 2007

Thursday, June 28th, 2007

BCE issues were hammered again, presumably in a delayed reaction to the Telus affront. The FixedFloater index (comprised entirely of BCE issues) is above its early-June lows, but has now given up the monster gains that accompanied the initial approach.

CPD, the subject of a recent article, went ex-dividend on 6/26 for just a hair under $0.20 per share, so don’t faint when you look at the NAVs!

Note that these indices are experimental; the absolute and relative daily values are expected to change in the final version. In this version, index values are based at 1,000.0 on 2006-6-30
Index Mean Current Yield (at bid) Mean YTW Mean Average Trading Value Mean Mod Dur (YTW) Issues Day’s Perf. Index Value
Ratchet 5.78% 5.78% 27,375 14.42 2 -0.0028% 958.9
Fixed-Floater 5.62% 5.91% 138,660 14.41 7 -1.7921% 899.0
Floater 4.84% 1.19% 87,293 11.21 3 -0.1335% 1,047.3
Op. Retract 4.84% 4.06% 86,360 3.33 17 -0.0451% 1,019.7
Split-Share 5.04% 4.60% 153,957 3.88 15 +0.0773% 1,043.6
Interest Bearing 6.77% 6.93% 85,715 6.14 4 +0.2953% 1,032.3
Perpetual-Premium 5.43% 5.16% 150,453 7.94 34 +0.1308% 1,020.0
Perpetual-Discount 5.06% 5.10% 497,685 15.32 29 +0.1485% 965.3
Major Price Changes
Issue Index Change Notes
BCE.PR.A FixFloat -4.1612%  
BCE.PR.I FixFloat -3.0884%  
BCE.PR.G FixFloat -2.4673%  
BCE.PR.R FixFloat -2.4390%  
PWF.PR.D OpRet -1.6573% Now with a pre-tax bid-YTW of 4.46% based on a bid of 26.11 and a softMaturity 2012-10-30 at 25.00.
POW.PR.D PerpetualDiscount +1.0879% Now with a pre-tax bid-YTW of 5.18% based on a bid of 24.16 and a limitMaturity.
POW.PR.C PerpetualPremium +1.2326% Now with a pre-tax bid-YTW of 5.30% based on a bid of 25.46 and a call 2012-1-5 at 25.00.
ELF.PR.G PerpetualDiscount +1.2745% Now with a pre-tax bid-YTW of 5.44% based on a bid of 22.25 and a limitMaturity.
Volume Highlights
Issue Index Volume Notes
CM.PR.I PerpetualDiscount 54,458 Now with a pre-tax bid-YTW of 5.06% based on a bid of 23.20 and a limitMaturity.
RY.PR.B PerpetualDiscount 34,186 Now with a pre-tax bid-YTW of 4.99% based on a bid of 23.77 and a limitMaturity.
BNS.PR.M PerpetualDiscount 32,035 Now with a pre-tax bid-YTW of 5.06% based on a bid of 22.66 and a limitMaturity.
RY.PR.F PerpetualDiscount 30,345 Now with a pre-tax bid-YTW of 5.11% based on a bid of 22.30 and a limitMaturity.
GWO.PR.I PerpetualDiscount 21,083 Now with a pre-tax bid-YTW of 5.09% based on a bid of 22.20 and a limitMaturity.

There were twenty-six other $25-equivalent index-included issues trading over 10,000 shares today.

June 26, 2007

Wednesday, June 27th, 2007

BCE issues were very disappointed to learn that Telus doesn’t want BCE and lost back much of their recent gains. Predict this, predict that, no information … what a life, eh? I’ll stick to analyzing cash-flows.

Note that these indices are experimental; the absolute and relative daily values are expected to change in the final version. In this version, index values are based at 1,000.0 on 2006-6-30
Index Mean Current Yield (at bid) Mean YTW Mean Average Trading Value Mean Mod Dur (YTW) Issues Day’s Perf. Index Value
Ratchet 5.68% 5.80% 28,411 14.38 2 -0.1100% 958.9
Fixed-Floater 5.50% 5.74% 140,272 14.48 7 -1.7177% 915.4
Floater 4.83% 1.82% 88,177 5.84 3 +0.0269% 1,048.7
Op. Retract 4.83% 3.92% 86,021 3.05 17 -0.0033% 1,020.2
Split-Share 5.03% 4.60% 156,131 4.04 15 -0.0881% 1,042.8
Interest Bearing 6.76% 7.08% 86,386 6.33 4 +0.6535% 1,029.2
Perpetual-Premium 5.42% 5.18% 150,239 8.35 34 +0.0182% 1,018.6
Perpetual-Discount 5.07% 5.11% 501,898 15.30 29 -0.0697% 963.9
Major Price Changes
Issue Index Change Notes
BCE.PR.R FixFloat -5.3555%  
BCE.PR.C FixFloat -2.3504%  
BCE.PR.A FixFloat -1.8065%  
CM.PR.J PerpetualDiscount -1.7301% Now with a pre-tax bid-YTW of 5.16% based on a bid of 21.80 and a limitMaturity.
LFE.PR.A SplitShare -1.4205% Now with a pre-tax bid-YTW of 4.49% based on a bid of 10.41 and a hardMaturity 2012-12-1 at 10.00
RY.PR.A PerpetualDiscount -1.4141% Now with a pre-tax bid-YTW of 5.04% based on a bid of 22.31 and a limitMaturity.
BCE.PR.G FixFloat -1.2230%  
BSD.PR.A InterestBearing +1.0638% Now with a pre-tax bid-YTW of 6.93% (as interest) based on a bid of 9.50 and a hardMaturity 2010-5-1 at 10.00
FIG.PR.A InterestBearing +1.8908% Now with a pre-tax bid-YTW of 6.80% (as interest) based on a bid of 9.70 and a hardMaturity 2014-12-31 at 10.00
Volume Highlights
Issue Index Volume Notes
CM.PR.A OpRet 503,325 Haven’t seen one of these for a while! Global crossed 249,300 for cash at 26.06, then crossed 249,300 for regular settlement at 25.72. Went ex-dividend today for 0.33125. Now with a pre-tax bid-YTW of 4.66% based on a bid of 25.51 and a softMaturity 2011-7-30 at 25.00.
BPO.PR.F Scraps (would be OpRet, but there are credit concerns) 103,846 Desjardins crossed 100,000 at 25.75. //Now with a pre-tax bid-YTW of 5.52% based on a bid of 25.62 and a softMaturity 2013-3-30 at 25.00.
GWO.PR.G PerpetualPremium (for now!) 56,135 RBC crossed 50,000 at 24.70. Now with a pre-tax bid-YTW of 5.30% based on a bid of 24.60 and a limitMaturity.
BCE.PR.C FixFloat 31,705  
RY.PR.G PerpetualDiscount 25,500 Now with a pre-tax bid-YTW of 5.08% based on a bid of 22.50 and a limitMaturity.
SLF.PR.E PerpetualDiscount 23,900 Now with a pre-tax bid-YTW of 5.07% based on a bid of 22.30 and a limitMaturity

There were thirteen other $25-equivalent index-included issues trading over 10,000 shares today.

Research: Claymore Preferred Share ETF

Tuesday, June 26th, 2007

I’ve discussed CPD in this blog in the past and I’ve also written a more formal article about it. Now that the July/August edition of Canadian Moneysaver has been published, I can now release this analysis published in their June edition.

Look for the research link!

Telus Doesn't Want BCE

Tuesday, June 26th, 2007

Telus has announced:

that it has elected not to submit an offer to acquire BCE as part of the strategic review process announced by BCE on April 17, 2007. The inadequacies of BCE’s bid process did not make it possible for TELUS to submit an offer.

… which could be mere posturing in order to get BCE to change their bid process, a reflection of regulatory problems … who knows? Pick your talking head, pick your explanation.

Ten year bonds for both companies widened 20bp on the news, perhaps reflecting the idea that now both will become LBO targets in shareholder-friendly ( = bondholder-hostile) events. But we will see!

I continue to think that BCE prefs are a crapshoot on credit right now and don’t want anything to do with them! There are, as yet, no words of wisdom from the ratings agencies.

BCE has the following preferred shares outstanding: BCE.PR.A, BCE.PR.C, BCE.PR.E, BCE.PR.F, BCE.PR.G, BCE.PR.H, BCE.PR.I, BCE.PR.R, BCE.PR.S, BCE.PR.T, BCE.PR.Y & BCE.PR.Z