Tammy Schirle of Wilfrid Laurier writes a good piece titled Six questions Ontario must answer before it starts a pension plan (although the headline writer confused ‘exhortations’ with ‘questions’):
- 1. Be clear about the market failures you are trying to address.
- 2. Be precise about the policy target.
- 3. Be clear about any redistribution that will occur.
- 4. Notice that low-income families won’t benefit from a simple expansion of benefits
- 5. How are you going to deal with interprovincial migration and interprovincial employment arrangements?
- 6. Enhancing the CPP remains the Ontario government’s preferred solution.
It was mixed day for the Canadian preferred share market, with PerpetualDiscounts gaining 1bp, FixedResets off 7bp and DeemedRetractibles up 2bp. Volatility was minimal. Volume was extremely low.
And now it’s time to start work on the July PrefLetter!
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
|||||||
| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 3.14 % | 3.13 % | 21,886 | 19.40 | 1 | 0.0000 % | 2,531.9 |
| FixedFloater | 4.17 % | 3.40 % | 27,277 | 18.66 | 1 | 0.4694 % | 4,158.4 |
| Floater | 2.89 % | 2.99 % | 47,081 | 19.78 | 4 | -0.8330 % | 2,737.5 |
| OpRet | 4.02 % | -5.85 % | 83,269 | 0.08 | 1 | 0.0784 % | 2,722.2 |
| SplitShare | 4.25 % | 3.94 % | 52,705 | 4.05 | 6 | 0.1397 % | 3,119.5 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0784 % | 2,489.1 |
| Perpetual-Premium | 5.53 % | -4.80 % | 84,342 | 0.09 | 17 | 0.0671 % | 2,427.2 |
| Perpetual-Discount | 5.25 % | 5.11 % | 109,101 | 15.23 | 20 | 0.0086 % | 2,571.5 |
| FixedReset | 4.39 % | 3.58 % | 193,323 | 4.62 | 76 | -0.0651 % | 2,560.5 |
| Deemed-Retractible | 4.98 % | 1.91 % | 129,476 | 0.12 | 43 | 0.0222 % | 2,547.8 |
| FloatingReset | 2.67 % | 2.12 % | 107,909 | 3.89 | 6 | 0.0658 % | 2,516.1 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| BAM.PR.X | FixedReset | -1.51 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-07-11 Maturity Price : 21.84 Evaluated at bid price : 22.11 Bid-YTW : 3.98 % |
| BAM.PR.K | Floater | -1.36 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-07-11 Maturity Price : 17.43 Evaluated at bid price : 17.43 Bid-YTW : 3.03 % |
| BAM.PR.C | Floater | -1.12 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-07-11 Maturity Price : 17.65 Evaluated at bid price : 17.65 Bid-YTW : 2.99 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| BAM.PF.F | FixedReset | 76,399 | Scotia crossed two blocks of 30,000 each, both at 25.55. YTW SCENARIO Maturity Type : Call Maturity Date : 2019-09-30 Maturity Price : 25.00 Evaluated at bid price : 25.54 Bid-YTW : 4.16 % |
| RY.PR.H | FixedReset | 75,221 | RBC bought blocks of 11,400 and 10,400 from TD, both at 25.55. Desjardins crossed 16,000 at the same price; Scotia crossed 21,600 at the same price again. YTW SCENARIO Maturity Type : Call Maturity Date : 2019-08-24 Maturity Price : 25.00 Evaluated at bid price : 25.52 Bid-YTW : 3.56 % |
| GWO.PR.G | Deemed-Retractible | 56,124 | RBC crossed 50,000 at 25.07. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.95 Bid-YTW : 5.28 % |
| BNA.PR.F | SplitShare | 29,738 | Recent new issue. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2021-10-08 Maturity Price : 25.00 Evaluated at bid price : 24.42 Bid-YTW : 4.91 % |
| CM.PR.O | FixedReset | 28,267 | Recent new issue. YTW SCENARIO Maturity Type : Call Maturity Date : 2019-07-31 Maturity Price : 25.00 Evaluated at bid price : 25.49 Bid-YTW : 3.57 % |
| CU.PR.G | Perpetual-Discount | 23,038 | Nesbitt crossed 20,000 at 22.50. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-07-11 Maturity Price : 22.18 Evaluated at bid price : 22.47 Bid-YTW : 5.05 % |
| There were 11 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| Issue | Index | Quote Data and Yield Notes |
| W.PR.H | Perpetual-Premium | Quote: 25.09 – 26.09 Spot Rate : 1.0000 Average : 0.6089 YTW SCENARIO |
| BAM.PR.X | FixedReset | Quote: 22.11 – 22.51 Spot Rate : 0.4000 Average : 0.2474 YTW SCENARIO |
| CU.PR.C | FixedReset | Quote: 25.87 – 26.25 Spot Rate : 0.3800 Average : 0.2693 YTW SCENARIO |
| VNR.PR.A | FixedReset | Quote: 25.52 – 25.88 Spot Rate : 0.3600 Average : 0.2688 YTW SCENARIO |
| MFC.PR.K | FixedReset | Quote: 25.12 – 25.49 Spot Rate : 0.3700 Average : 0.2796 YTW SCENARIO |
| IAG.PR.A | Deemed-Retractible | Quote: 23.17 – 23.45 Spot Rate : 0.2800 Average : 0.1963 YTW SCENARIO |