Ran across these in a newsletter that I follow... Gotta be among the most kinky and esoteric securities I have seen. Can anyone explain how these work in plain English, in one or two paragraphs? You're holding preferred stock that has a mandatory purchase contract that converts it into common shares a specified price, but there also seems to be a debt instrument involved somehow, and I can't figure it out LOL The symbols are NEE/PRR and UGIC https://quantumonline.com/search.cfm?tickersymbol=NEE-R&sopt=symbol https://quantumonline.com/search.cfm?tickersymbol=UGIC&sopt=symbol
It’s like a partial covered call on a long stock. You own the stock, more or less, but you’re not quite sure how much. Less if the price rises, more if it falls. They’re dumb securities with a fake yield, priced in already, to trick retail. Hard pass.