{"id":745,"date":"2007-04-09T14:06:52","date_gmt":"2007-04-09T18:06:52","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=745"},"modified":"2007-04-09T14:06:52","modified_gmt":"2007-04-09T18:06:52","slug":"preferred-shares-are-equities-says-cifsc","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=745","title":{"rendered":"Preferred Shares are Equities, says CIFSC"},"content":{"rendered":"<p>The <a href=\"http:\/\/www.cifsc.org\">Canadian Investment Funds Standards Committee<\/a><\/p>\n<blockquote>\n<p>was formed in January 1998 by Canada&#8217;s major mutual fund database and research firms with a self-imposed mandate to standardize the classifications of Canadian-domiciled mutual funds.<\/p>\n<\/blockquote>\n<p>They have now released a new classification scheme of funds&#8217; <a href=\"http:\/\/www.cifsc.org\/en\/CIFSC%202007%20Category%20Definitions%20-%2005April07.pdf\">underlying investments<\/a> and provided schematics of <a href=\"http:\/\/www.cifsc.org\/en\/CIFSC%20Flow%20Chart%20-%2005April07.pdf\">how funds may be categorized<\/a>.<\/p>\n<p>Preferreds and Convertible Preferreds are both considered to be equities. It is not clear to me whether a preferred that converts into common at a variable rate based on the market price is considered a convertible preferred, or whether this status is reserved for preferreds that convert into a fixed number of common and can therefore &#8216;trade off the stock&#8217;.<\/p>\n<p>At any rate, I find the classification of preferred shares as equities by default to be more than just a little bit puzzling, and <a href=\"http:\/\/www.cifsc.org\/en\/feedback.php\">have sent them a query<\/a>:<\/p>\n<blockquote>\n<p>I note that preferred shares are considered to be equities by default, although you note that you may treat them as fixed income on an exception basis.<\/p>\n<p>How did you arrive at the conclusion that this was the correct classification? Did you, for instance, perform a correlation analysis between historical returns preferred shares, equities and bonds?<\/p>\n<p>On what basis will exceptions be considered?<\/p>\n<\/blockquote>\n<p>We shall see!<\/p>\n<p>Hat tip to <a href=\"http:\/\/www.financialwebring.org\/forum\/viewtopic.php?t=104982\">Financial Webring<\/a> for publicizing this development.\n<\/p>\n<p><!--96ecbbb628c8993d4f09ab5416206678--><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Canadian Investment Funds Standards Committee was formed in January 1998 by Canada&#8217;s major mutual fund database and research firms with a self-imposed mandate to standardize the classifications of Canadian-domiciled mutual funds. They have now &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16],"tags":[],"class_list":["post-745","post","type-post","status-publish","format-standard","hentry","category-miscellaneous-news"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/745","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=745"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/745\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=745"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=745"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=745"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}