- Comparing future cash flows from individual preferred shares can be a useful tool for figuring out which share should be worth more.
- IVR-B and IVR-C are out of whack. Neither is great, but IVR-C is clearly a better deal when it costs $.50 less than IVR-B.
- There’s a better deal in the preferred shares from Two Harbors. TWO-B dipped below our target buy-under price.
- Contrasting TWO-B with TWO-C (or with TWO-A) demonstrates that the recent weakness for TWO-B is more significant than the weakness in TWO-C and TWO-A (a positive sign for buyers).
- If the trade would have substantial (negative) tax consequences for you, it won't be right for you. Some people might actually see taxable benefits. Beware liquidity. Investors swapping positions should do a limited amount of shares in a single trade.
For further details see:
How To Pick Between Similar Preferred Shares