Sad but true … Bernanke did not resist a suggestion that the uptick rule be reinstated. We can only hope that cooler heads will prevail:
“In the kind of environment we have seen more recently” the so-called uptick rule “might have had some benefit,” Bernanke said in testimony before the House Financial Services Committee today. The rule, scrapped by the U.S. Securities and Exchange Commission in 2007, barred investors from betting against a stock until it sells at a higher price than the preceding trade.
…
The SEC approved the rule in 1938 to prevent bear raids on companies. The agency eliminated the regulation after studying its effect on share prices and determining it was no longer relevant in markets dominated by fast-paced electronic trading.Executives at UBS AG, Deutsche Bank AG and Knight Capital Group Inc. said in December that bringing back the rule wouldn’t reduce volatility in stock prices.
If a portfolio manager sees a price go down for a reason he doesn’t understand, there are three possibilities:
- Insider information
- The market’s being stupid and should be ignored or, better yet, exploited
- He isn’t doing his job
Crack down on insider information, tipping and rumour-mongering by all means. That’s a valid regulatory function. But let’s also see a crackdown on underperforming PMs – any advisor with discretionary authority should definitely see their results published by the regulators; same goes for advisory relationships, although I am more willing to listen to arguments about that one – and the cult of the salesman that regards investment management as being nothing more than an unfortunate cost.
PerpetualDiscounts were off marginally today to yield 7.23%, equivalent to 10.12% interest at the standard conversion factor of 1.4x. Long Corporates appear to have found a level at 7.5% (maybe just a hair under), so the pre-tax interest-equivalent spread has widened again, to … call it 265bp.
SplitShares had a good day, helped along, I think, by bidders failing to notice (or care) that there were a lot of ex-Days today.
| 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 | 5.28 % | 3.65 % | 23,884 | 18.07 | 2 | -0.1211 % | 851.7 |
| FixedFloater | 7.35 % | 6.88 % | 78,305 | 14.06 | 7 | 0.1674 % | 1,365.3 |
| Floater | 5.03 % | 4.23 % | 25,881 | 16.98 | 4 | 1.2367 % | 1,044.2 |
| OpRet | 5.25 % | 4.86 % | 141,063 | 3.97 | 15 | 0.0386 % | 2,047.8 |
| SplitShare | 6.82 % | 12.06 % | 71,467 | 3.98 | 15 | 1.5975 % | 1,647.8 |
| Interest-Bearing | 7.27 % | 8.81 % | 39,044 | 0.81 | 2 | 0.4172 % | 1,945.8 |
| Perpetual-Premium | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.0392 % | 1,513.2 |
| Perpetual-Discount | 7.12 % | 7.23 % | 175,817 | 12.27 | 71 | -0.0392 % | 1,393.6 |
| FixedReset | 6.11 % | 5.77 % | 551,789 | 13.84 | 27 | -0.3440 % | 1,802.6 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| PWF.PR.G | Perpetual-Discount | -2.69 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 19.56 Evaluated at bid price : 19.56 Bid-YTW : 7.66 % |
| DFN.PR.A | SplitShare | -2.43 % | Asset coverage of 1.6-:1 as of February 13 according to the company. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2014-12-01 Maturity Price : 10.00 Evaluated at bid price : 8.25 Bid-YTW : 9.30 % |
| BAM.PR.K | Floater | -1.89 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 7.80 Evaluated at bid price : 7.80 Bid-YTW : 6.86 % |
| TD.PR.P | Perpetual-Discount | -1.77 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 19.40 Evaluated at bid price : 19.40 Bid-YTW : 6.86 % |
| BNS.PR.O | Perpetual-Discount | -1.72 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 21.13 Evaluated at bid price : 21.13 Bid-YTW : 6.72 % |
| CM.PR.E | Perpetual-Discount | -1.60 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 19.05 Evaluated at bid price : 19.05 Bid-YTW : 7.47 % |
| MFC.PR.B | Perpetual-Discount | -1.54 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 16.01 Evaluated at bid price : 16.01 Bid-YTW : 7.29 % |
| GWO.PR.F | Perpetual-Discount | -1.54 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 20.50 Evaluated at bid price : 20.50 Bid-YTW : 7.35 % |
| TD.PR.A | FixedReset | -1.45 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 22.39 Evaluated at bid price : 22.43 Bid-YTW : 4.67 % |
| MFC.PR.C | Perpetual-Discount | -1.44 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 15.04 Evaluated at bid price : 15.04 Bid-YTW : 7.51 % |
| FIG.PR.A | Interest-Bearing | -1.41 % | Asset coverage of 1.0+:1 as of February 20, based on Capital units at $0.39 and 0.53 Capital Units per preferred. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2014-12-31 Maturity Price : 10.00 Evaluated at bid price : 7.00 Bid-YTW : 14.37 % |
| RY.PR.H | Perpetual-Discount | -1.39 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 20.51 Evaluated at bid price : 20.51 Bid-YTW : 6.95 % |
| RY.PR.R | FixedReset | -1.34 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2014-03-26 Maturity Price : 25.00 Evaluated at bid price : 25.11 Bid-YTW : 6.30 % |
| CM.PR.G | Perpetual-Discount | -1.33 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 18.52 Evaluated at bid price : 18.52 Bid-YTW : 7.40 % |
| CM.PR.P | Perpetual-Discount | -1.16 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 18.77 Evaluated at bid price : 18.77 Bid-YTW : 7.44 % |
| PWF.PR.L | Perpetual-Discount | -1.15 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 17.24 Evaluated at bid price : 17.24 Bid-YTW : 7.51 % |
| TD.PR.G | FixedReset | -1.14 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2014-05-30 Maturity Price : 25.00 Evaluated at bid price : 25.11 Bid-YTW : 6.30 % |
| BNS.PR.R | FixedReset | -1.12 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 21.96 Evaluated at bid price : 22.00 Bid-YTW : 4.70 % |
| TD.PR.O | Perpetual-Discount | -1.07 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 18.51 Evaluated at bid price : 18.51 Bid-YTW : 6.64 % |
| BCE.PR.G | FixedFloater | 1.01 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 25.00 Evaluated at bid price : 15.05 Bid-YTW : 6.93 % |
| NA.PR.K | Perpetual-Discount | 1.03 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 20.56 Evaluated at bid price : 20.56 Bid-YTW : 7.20 % |
| POW.PR.C | Perpetual-Discount | 1.11 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 19.11 Evaluated at bid price : 19.11 Bid-YTW : 7.74 % |
| BMO.PR.L | Perpetual-Discount | 1.21 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 20.14 Evaluated at bid price : 20.14 Bid-YTW : 7.27 % |
| BNA.PR.A | SplitShare | 1.26 % | Asset coverage of 1.9-:1 as of January 31 according to the company. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2010-09-30 Maturity Price : 25.00 Evaluated at bid price : 24.10 Bid-YTW : 8.66 % |
| GWO.PR.G | Perpetual-Discount | 1.27 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 17.57 Evaluated at bid price : 17.57 Bid-YTW : 7.57 % |
| PWF.PR.H | Perpetual-Discount | 1.29 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 18.79 Evaluated at bid price : 18.79 Bid-YTW : 7.77 % |
| SLF.PR.C | Perpetual-Discount | 1.37 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 14.76 Evaluated at bid price : 14.76 Bid-YTW : 7.55 % |
| BNA.PR.B | SplitShare | 1.38 % | Asset coverage of 1.9-:1 as of January 31 according to the company. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2016-03-25 Maturity Price : 25.00 Evaluated at bid price : 20.60 Bid-YTW : 8.31 % |
| CIU.PR.A | Perpetual-Discount | 1.48 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 16.50 Evaluated at bid price : 16.50 Bid-YTW : 7.02 % |
| ALB.PR.A | SplitShare | 1.57 % | Asset coverage of 1.0-:1 as of February 19, according to Scotia. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2011-02-28 Maturity Price : 25.00 Evaluated at bid price : 19.40 Bid-YTW : 18.15 % |
| SLF.PR.A | Perpetual-Discount | 1.64 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 15.45 Evaluated at bid price : 15.45 Bid-YTW : 7.70 % |
| W.PR.H | Perpetual-Discount | 1.66 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 19.56 Evaluated at bid price : 19.56 Bid-YTW : 7.16 % |
| STW.PR.A | Interest-Bearing | 1.76 % | Asset coverage of 1.5+:1 based on Capital Unit NAV of 2.48 and 2.12 Capital Units per preferred. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2009-12-31 Maturity Price : 10.00 Evaluated at bid price : 9.85 Bid-YTW : 8.81 % |
| HSB.PR.D | Perpetual-Discount | 1.80 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 17.55 Evaluated at bid price : 17.55 Bid-YTW : 7.28 % |
| BNS.PR.M | Perpetual-Discount | 1.83 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 17.28 Evaluated at bid price : 17.28 Bid-YTW : 6.60 % |
| SLF.PR.D | Perpetual-Discount | 2.07 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 14.80 Evaluated at bid price : 14.80 Bid-YTW : 7.53 % |
| FBS.PR.B | SplitShare | 2.16 % | Asset coverage of 0.9+:1 as of February 19 according to the company. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2011-12-15 Maturity Price : 10.00 Evaluated at bid price : 6.43 Bid-YTW : 22.67 % |
| BAM.PR.B | Floater | 2.17 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 8.00 Evaluated at bid price : 8.00 Bid-YTW : 6.69 % |
| FFN.PR.A | SplitShare | 2.20 % | Asset coverage of 1.0+:1 as of February 13 according to the company. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2014-12-01 Maturity Price : 10.00 Evaluated at bid price : 5.71 Bid-YTW : 17.50 % |
| SLF.PR.E | Perpetual-Discount | 2.34 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 14.90 Evaluated at bid price : 14.90 Bid-YTW : 7.56 % |
| POW.PR.A | Perpetual-Discount | 2.43 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 18.95 Evaluated at bid price : 18.95 Bid-YTW : 7.53 % |
| IAG.PR.C | FixedReset | 2.46 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 21.50 Evaluated at bid price : 21.50 Bid-YTW : 6.45 % |
| POW.PR.B | Perpetual-Discount | 2.70 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 17.90 Evaluated at bid price : 17.90 Bid-YTW : 7.62 % |
| LFE.PR.A | SplitShare | 2.81 % | Asset coverage of 1.2+:1 as of February 13 according to the company. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2012-12-01 Maturity Price : 10.00 Evaluated at bid price : 7.78 Bid-YTW : 12.96 % |
| PPL.PR.A | SplitShare | 3.02 % | Asset coverage of 1.3+:1 as of February 13 according to the company. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2012-12-01 Maturity Price : 10.00 Evaluated at bid price : 8.21 Bid-YTW : 10.91 % |
| BCE.PR.F | FixedFloater | 3.10 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 25.00 Evaluated at bid price : 14.95 Bid-YTW : 6.88 % |
| TRI.PR.B | Floater | 3.38 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 13.45 Evaluated at bid price : 13.45 Bid-YTW : 3.95 % |
| FTN.PR.A | SplitShare | 3.61 % | Asset coverage of 1.2-:1 as of February 13 according to the company. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2015-12-01 Maturity Price : 10.00 Evaluated at bid price : 6.95 Bid-YTW : 12.06 % |
| LBS.PR.A | SplitShare | 4.55 % | Asset coverage of 1.1+:1 as of February 19 according to the company. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2013-11-29 Maturity Price : 10.00 Evaluated at bid price : 7.58 Bid-YTW : 12.38 % |
| SBC.PR.A | SplitShare | 4.69 % | Asset coverage of 1.2+:1 as of February 19 according to the company. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2012-11-30 Maturity Price : 10.00 Evaluated at bid price : 7.59 Bid-YTW : 14.01 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| ELF.PR.F | Perpetual-Discount | 160,100 | Desjardins crossed 150,000 at 15.00. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 14.77 Evaluated at bid price : 14.77 Bid-YTW : 9.17 % |
| TD.PR.G | FixedReset | 145,235 | Recent new issue. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-05-30 Maturity Price : 25.00 Evaluated at bid price : 25.11 Bid-YTW : 6.30 % |
| FBS.PR.B | SplitShare | 124,801 | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2011-12-15 Maturity Price : 10.00 Evaluated at bid price : 6.43 Bid-YTW : 22.67 % |
| RY.PR.R | FixedReset | 116,161 | Recent new issue. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-03-26 Maturity Price : 25.00 Evaluated at bid price : 25.11 Bid-YTW : 6.30 % |
| BNS.PR.X | FixedReset | 96,925 | Recent new issue. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-05-25 Maturity Price : 25.00 Evaluated at bid price : 25.11 Bid-YTW : 6.30 % |
| MFC.PR.B | Perpetual-Discount | 89,600 | TD crossed 37,200 at 16.26; Nesbitt bought 10,000 from Scotia at 16.26; Scotia crossed 36,600 at 16.25. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-02-25 Maturity Price : 16.01 Evaluated at bid price : 16.01 Bid-YTW : 7.29 % |
| There were 30 other index-included issues trading in excess of 10,000 shares. | |||