2024-02-02 08:30:00 ET
Summary
- Preferred securities improve portfolio defensiveness and income safety, dual qualities of an ideal retirement.
- With a history of low default rates, today’s preferreds carry much higher credit quality.
- We discuss two discounted preferreds with up to 7.8% yields.
Co-authored with 'Hidden Opportunities'
The history of preferred shares goes back to the 19th century when investors in railway companies demanded "preference" in the payment of dividends over the holders of common shares. They then evolved into a highly utilized method of raising capital in a non-dilutionary manner by industries with stable operations and reliable profitability. In the 70s and 80s, utility companies dominated the preferred market. By the early 90s, the banking sector issued preferreds to power their recovery after the savings and loan crisis....
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For further details see:
2 Great Preferred Stocks For A Retirement Dream