02-24-2014, 09:57 AM
Alex is correct. Preferred is above a common share when it comes to liquidation but after secured debt instruments (bonds).
It makes then interest rate sensitive rather than company performance sensitive although there can be a slight margin due to company performance although I haven't been able to see it and identify it as such. Sometimes it's just a function of market inefficiency.
It makes then interest rate sensitive rather than company performance sensitive although there can be a slight margin due to company performance although I haven't been able to see it and identify it as such. Sometimes it's just a function of market inefficiency.