Some reviews of Preferred Shares recommended on Thursday AM July 30th (11 trading days):
BMO.PR.L : $24.95 - $25.25 (+ 36 cents dividend to follow)
RY.PR.D : $19.68 - $20.60 (+4.7%)
RY.PR.X : $27.68 - $28.00
SLF.PR.A : $19.00 - $20.97 (+10.4% !!!)
SLF.PR.B : $19.25 - $21.19 (+10.1% !!!)
According to the National Post (Financial Post) this past weekend, 67 stocks on the TSX hit 52 week highs on Friday.
Of these 67 listings, 46 were for Preferred Shares. 3 were for I Shares, 3 Trust Units, 4 warrants/debentures/receipts, and
only 11 were for common shares.
Bond Yields: Provincial Coupon Bonds 8 -15 years out are yielding between 4.0 – 4.8%. Canadian Corporate Bonds of the same period are yielding between 4.4 – 6.7 %. Corresponding US Corporate Bonds are yielding 5.5 – 7.5%. High Yield US Corporate (“Junk”) Bonds including Ford 2012 and Hertz 2014 are yielding approximately 10%. If one has US Cash and requires income and reasonable security, it appears (currency risk notwithstanding) that the US offers better value for the risk.
The market appears to be somewhat overbought at present. When P/E ratios of major banks (e.g. RY)are approximately the same as technology firms such as RIM, it would indicate that share prices of the banks are a little high and/or those of the technology firms too low. I assume the former to be most accurate. Stay cautious and keep the powder dry for upcoming opportunities. See you later during the week. Warren.
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