- The preferred stock space has been richly valued for some time as the 'other' funds join Flaherty & Crumrine ("F&C") funds in premium land.
- F&C is the premier manager in the preferred stock space, across any publicly traded asset type, with a fantastic long-term track record.
- The F&C funds still trade at a premium to NAV, but they haven't seen a large increase in their valuation in the last several months like the rest of the sector.
- This is a relative value play and a place to pickup a nice 6.5% yield with decent credit quality in the hybrid space (grey area between stocks and bonds).
- We recommend FFC and FLC as options for your portfolio but not as a swap from FPF, our Core Holding.
For further details see:
Time To Swap Finally To Flaherty Preferreds And Capture Relative Value?