BMO S&P/TSX Laddered Preferred

ZPR-T

Analysis and Opinions about ZPR-T

Signal
Opinion
Expert
COMMENT
COMMENT
April 4, 2017

How will rising interest rates affect this? This is a “rules based” ETF and is made up of 100% fixed reset preferred shares. In theory, in a rise in rates, this would perform well.

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How will rising interest rates affect this? This is a “rules based” ETF and is made up of 100% fixed reset preferred shares. In theory, in a rise in rates, this would perform well.

COMMENT
COMMENT
March 13, 2017

Will the rise in value of this ETF continue? The TD Bank and Bank of Montréal launched some structured products into the market that were linked to the payouts of the preferreds, and they were wildly successful. The demand for these preferreds went through the roof. He doesn’t think this is sustainable and he sold into the rally. He doesn’t like the value up here and is reducing his exposure.

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Will the rise in value of this ETF continue? The TD Bank and Bank of Montréal launched some structured products into the market that were linked to the payouts of the preferreds, and they were wildly successful. The demand for these preferreds went through the roof. He doesn’t think this is sustainable and he sold into the rally. He doesn’t like the value up here and is reducing his exposure.

PARTIAL SELL
PARTIAL SELL
February 27, 2017

This is expensive now. He has been selling into the strength since December. If it gets back to those levels he would buy back in.

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This is expensive now. He has been selling into the strength since December. If it gets back to those levels he would buy back in.

PAST TOP PICK
PAST TOP PICK
December 23, 2016

(A Top Pick July 29/16. Up 8.13%.) Has a lot of clients that are really focused on how they are going to get the income they need. Every 5 years, these preferred shares get reset, and they benefit when interest rates are going up.

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(A Top Pick July 29/16. Up 8.13%.) Has a lot of clients that are really focused on how they are going to get the income they need. Every 5 years, these preferred shares get reset, and they benefit when interest rates are going up.

COMMENT
COMMENT
December 9, 2016

These are great vehicles, but in an upward climbing interest rate environment, it is going to be tougher for preferred shares, unless a lot of them are rate resets and are hedged to inflation.

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These are great vehicles, but in an upward climbing interest rate environment, it is going to be tougher for preferred shares, unless a lot of them are rate resets and are hedged to inflation.

COMMENT
COMMENT
December 9, 2016

This has a number of reset preferreds in it, which is why he thinks it took a big hit. If you are looking at this today, he thinks it is a reasonable Buy as an income component of your portfolio. He prefers preferred shares and high dividend paying common shares at this point, relative to the bonds. Thinks the next resets you will see on a number of these instruments are going to be higher as interest rates are rising.

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This has a number of reset preferreds in it, which is why he thinks it took a big hit. If you are looking at this today, he thinks it is a reasonable Buy as an income component of your portfolio. He prefers preferred shares and high dividend paying common shares at this point, relative to the bonds. Thinks the next resets you will see on a number of these instruments are going to be higher as interest rates are rising.

HOLD
HOLD
October 6, 2016

Sell? All of these tanked 1.5 years ago. A number of institutions have been buying the preferreds now, and he doesn’t see any reason to be selling this, once you have taken their hit. Also, as rates go up, some of the resets may be setting at a higher rate. A good fund and very well diversified. 5.5% dividend yield.

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Sell? All of these tanked 1.5 years ago. A number of institutions have been buying the preferreds now, and he doesn’t see any reason to be selling this, once you have taken their hit. Also, as rates go up, some of the resets may be setting at a higher rate. A good fund and very well diversified. 5.5% dividend yield.

PARTIAL SELL
PARTIAL SELL
August 15, 2016

Preferred shares. They had a good run-up in recent weeks. He is just starting to lighten up his position. It could go another 5%. We are getting close to 52 week highs. We cannot get back to the historic highs, however, of the last number of years.

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Preferred shares. They had a good run-up in recent weeks. He is just starting to lighten up his position. It could go another 5%. We are getting close to 52 week highs. We cannot get back to the historic highs, however, of the last number of years.

WEAK BUY
WEAK BUY
August 4, 2016

It got clobbered a year ago because all the rate reset preferred dropped. Right now they are offering a pretty good yield and they are well diversified. The problem with individual preferreds is the trouble getting rid of them. If he was going to buy a preferred, he would buy this.

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It got clobbered a year ago because all the rate reset preferred dropped. Right now they are offering a pretty good yield and they are well diversified. The problem with individual preferreds is the trouble getting rid of them. If he was going to buy a preferred, he would buy this.

TOP PICK
TOP PICK
July 29, 2016

Rate reset preferreds started coming out in 2008. They declare a dividend which has a formula attached to it. Every 5 years that rate gets reset based on a formula, a 5-year Government bond and some kind of spread. Sold off a lot last year, because the yield curve flattened significantly and there was a fear the rate resets were going to be a lot lower. However, what has tended to happen, is that you are now getting yields of about 5.5%. Actually one of the few securities that if interest rates go up, you are going to benefit from it. He could see about 5%-10% growth, plus reset rates going higher if rates do increase.

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Rate reset preferreds started coming out in 2008. They declare a dividend which has a formula attached to it. Every 5 years that rate gets reset based on a formula, a 5-year Government bond and some kind of spread. Sold off a lot last year, because the yield curve flattened significantly and there was a fear the rate resets were going to be a lot lower. However, what has tended to happen, is that you are now getting yields of about 5.5%. Actually one of the few securities that if interest rates go up, you are going to benefit from it. He could see about 5%-10% growth, plus reset rates going higher if rates do increase.

HOLD
HOLD
July 4, 2016

If interest rates stay where they are over the next 1-2 years, then this type of product and most dividend paying products will be fine more or less. He thinks most of the carnage was seen in 2015.

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If interest rates stay where they are over the next 1-2 years, then this type of product and most dividend paying products will be fine more or less. He thinks most of the carnage was seen in 2015.

COMMENT
COMMENT
May 19, 2016

BMO S&P/TSX Laddered Preferred (ZPR-T) or iShares S&P/TSX preferred (CPD-T)? The only difference between these 2 is that this one probably has a little bit more in rate reset preferred shares. Those are the shares that will do well when interest rates start to move higher. The both are very similar though. There is going to be some volatility in the preferred share market.

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BMO S&P/TSX Laddered Preferred (ZPR-T) or iShares S&P/TSX preferred (CPD-T)? The only difference between these 2 is that this one probably has a little bit more in rate reset preferred shares. Those are the shares that will do well when interest rates start to move higher. The both are very similar though. There is going to be some volatility in the preferred share market.

PARTIAL SELL
PARTIAL SELL
April 25, 2016

Lost 28% in this. Sell or Hold? Last year the preferred market was down. This should not be a large part of your fixed income portion, and you should take some off the table, and reapportionment into a traditional fixed income security such as government or corporate bonds.

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Lost 28% in this. Sell or Hold? Last year the preferred market was down. This should not be a large part of your fixed income portion, and you should take some off the table, and reapportionment into a traditional fixed income security such as government or corporate bonds.

PARTIAL BUY
PARTIAL BUY
March 21, 2016

Preferred Shares Index. Close to 6.5%. The preferred space has been really stressed. Convertible shares protect shareholders in a rising rate environment. However, that has not been the case so there has been low levels of interest in these shares. He has these holdings for clients as a diversification tool.

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Preferred Shares Index. Close to 6.5%. The preferred space has been really stressed. Convertible shares protect shareholders in a rising rate environment. However, that has not been the case so there has been low levels of interest in these shares. He has these holdings for clients as a diversification tool.

COMMENT
COMMENT
February 16, 2016

Preferreds got really clobbered this year, and are down about 24% on the year. A lot of institutions were buying them because they were representing pretty good value and paying about 6%. Has bought a little bit for some clients that were looking for yield. Doesn’t particularly like preferreds because you are basically exchanging the yield of a bond with the risk of a stock.

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Preferreds got really clobbered this year, and are down about 24% on the year. A lot of institutions were buying them because they were representing pretty good value and paying about 6%. Has bought a little bit for some clients that were looking for yield. Doesn’t particularly like preferreds because you are basically exchanging the yield of a bond with the risk of a stock.

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