About Canadian Preferred (Cdnprefs) Shares
They are hybrid security with both an equity and fixed income component. They are positioned in the middle of the hierarchical order between common stock and senior debt.
They pay regular dividends predetermined during issuance at a fixed or floating rate.
Preferred share payments are made prior to common shareholder dividend payments.
Preferred share are relatively inexpensive (require a lower amount of investment capital) compared to bonds.
They carry no voting rights unless dividend payment(s) are missed.
Cdnprefs – Structure Composition
Retractable Preferred Shares
Perpetual Preferred Shares
Rate-Reset Preferred Shares (Fixed Reset)
Floating Preferred Shares
Split Preferred Shares (Structured)
Cdnprefs - Industry Composition
Financial institutions (e.g. Banks, Insurance companies and other Financial Services) make up close to 60% of the Canadian prefs market.
Diversified (e.g. Pipelines, Retail, Conglomerate, Communications / Media, Energy) make up close to 20% of the Canadian prefs market.