«Fiera typically beats
the preferred share index by more than the price difference,» says Terry Shaunessy of Shaunessy Investment Counsel.
Not exact matches
The fund is referred to as «aggressive» because the composition of the fund does not necessarily reflect the composition of its benchmark
index: it may invest in
preferred shares issued by Split
Share Corporations, for instance, and is not required to hold such classes of
shares as floating rate issues, which are expected to underperform for the foreseeable future.
The
preferred share market has had strong performance year to date, with iShares S&P / TSX Canadian Preferred Share Index ETF (CPD) up around 6 % in
share market has had strong performance year to date, with iShares S&P / TSX Canadian
Preferred Share Index ETF (CPD) up around 6 % in
Share Index ETF (CPD) up around 6 % in 2017.
In particular, our
preferred model finds that a ten percentage point increase in private
share of schooling enrollment within a nation, over time, is associated with a 7.4 % of a standard deviation increase in the Political Rights
Index and an 8 % of a standard deviation increase in the Economic Freedom of the World
Index.
The S&P U.S.
Preferred Stock
Index comprises
preferred shares of each dividend payment type.
The
preferred share market has had strong performance year to date, with iShares S&P / TSX Canadian Preferred Share Index ETF (CPD) up around 6 % in
share market has had strong performance year to date, with iShares S&P / TSX Canadian
Preferred Share Index ETF (CPD) up around 6 % in
Share Index ETF (CPD) up around 6 % in 2017.
The NYSE also has
index funds of
preferred shares, which I'm into as well.
BMO U.S.
Preferred Share Index ETF (ZUP): Cap - weighted fund invested in U.S.
preferred shares (which typically have fixed distributions), offering geographical as well as currency diversification.
The appeal of
preferred funds is they offer higher yields than bond ETFs, explains Alfred Lee, vice-president of BMO Global Asset Management and lead manager of the bank's Laddered
Preferred Share Index ETF (TSX: ZPR).
BMO Laddered Preferred
Share Index ETF (ZPR): Laddered fund of strictly rate - reset
preferreds, 20 % of which will reset their payout in any one year, which reduces the interest rate risk.
iShares S&P / TSX Canadian Preferred
Share Index ETF (CPD): Cap - weighted fund reflecting the broad market for Canadian
preferreds.
The iShares S&P / TSX Canadian
Preferred Share Index ETF (TSX: CPD), one of the longest - trading preferred share ETFs on the market, experienced slumps approaching 30 % in 2008 during the financial crisis and again in 2014
Share Index ETF (TSX: CPD), one of the longest - trading
preferred share ETFs on the market, experienced slumps approaching 30 % in 2008 during the financial crisis and again in 2014
share ETFs on the market, experienced slumps approaching 30 % in 2008 during the financial crisis and again in 2014 - 15.
For example, the BMO S&P / TSX Laddered
Preferred Share Index ETF, symbol ZPR on the Toronto stock exchange, holds floating - rate
preferred shares that pays dividends that fluctuate with changes in interest rates.
The S&P / TSX
Preferred Share Index launched on June 12, 2007 and is designed to measure the performance of Canadian
preferred stock.
The S&P / TSX
Preferred Share Index is comprised of preferred shares issued primarily by financial companies (65 per cent of the index curren
Index is comprised of
preferred shares issued primarily by financial companies (65 per cent of the
index curren
index currently).
The
index comprises about 250 companies, including dividend - paying stocks, real estate investment trusts, master limited partnerships,
preferred shares and income trusts.
At Canso, we have used the RBC CM Bond
Indices since they did not include bank capital securities which are practically and legally
preferred shares.
PowerShares Canadian
Preferred Share ETF (TSX: PPS) tracks an
index of Canadian
preferred shares.
In 2015, rate reset
preferred shares dropped in value significantly, causing the S&P / TSX Preferred Shares index to fall 20 % between January and September
shares dropped in value significantly, causing the S&P / TSX
Preferred Shares index to fall 20 % between January and September
Shares index to fall 20 % between January and September 2015.
In 2013, where the markets saw increased rates, the S&P / TSX Preferred
Share Laddered
Index which is composed solely of rate - reset
preferreds, had a total return of +0.88 %.
Using the empirical method by regressing historical portfolio returns of
preferreds (represented by the S&P / TSX Preferred
Share Index) to changes in interest rates, we found that
preferreds in Canada have a historical duration estimate of -1.7.
Looking at the performance of each
preferred share type in 2013 using the S&P / TSX Preferred Share Index, fixed rate preferreds performed the worst and floating rate preferreds performed the
share type in 2013 using the S&P / TSX
Preferred Share Index, fixed rate preferreds performed the worst and floating rate preferreds performed the
Share Index, fixed rate
preferreds performed the worst and floating rate
preferreds performed the best.
This liquidity can be constrained in areas such as
preferred shares and high yield bonds, which makes
indexing difficult.
The ETF may also invest in
preferred shares of companies located in the United States, fixed income securities of Canadian and U.S. issuers, including other income generating securities, as well as Canadian equity securities and exchange traded funds that issue
index participation units.
That was a wise choice, because trying to improve on this simple model is, in my opinion, the biggest knock against many of the competitors to these new ETFs, including the iShares CorePortfolios (CBD and CBN), which hold REITs, high - yield bonds,
preferred shares, and track fundamental
indexes.