Why does this product chart this way?

Discussion in 'Fixed Income' started by xandman, Mar 20, 2020.

  1. xandman


    Ignore the big drop. Why did this preferred stock rise steadily upward when there is considerably more volatility in whatever reference rate they use to determine value?

    This stock was paying out dividends as they came due.

    I am missing something basic here. Please educate me.

    Nobert likes this.
  2. Nobert


    Sometimes i miss read the question, noneless, here's my version of why/because :
    • It's a REITā€”Mortgage (ain't gona find too many Reits/Biotechs/Chemicals in BRK holdings list and there's very solid reason for that)
    • It's a - fundamental trash (could find worse examples tho)
    • Never went above $26.5 (quite rare to find such solid ,,res'')
    • While good companies goes down, in times like these, trash like this, flies down
    • Lov vol
    • If it's fund, etf or asset management, i skip instantly no matter the price, to save my time. Damn funds and asset managers ;)
    • Dividends doesn't matter, when it comes to trash like this.
    Why did i called it trash 3 times ?

    Just compere these two graphs:


    p.s don't know why this is in off-topic section.
    Last edited: Mar 20, 2020
  3. xandman


    Sorry, I should have emphasized that these are the preferred stock shares. It's a form of debt that pays almost in perpetuity or until called. Subordinate to Bonds but senior to Common Shares in the event of a corporate liquidation.

    Given that it is an obligation to pay an amount on a periodic basis, it's really odd this thing never swung around with medium or long rates.
    Nobert likes this.
  4. Nobert


    Yup, my bad as well. I read about P-Shares in Security Analysis, wasn't sure tho, do they exists till this day.
    then r.i.p those who have non preferred.
  5. you need to get up to speed

    prefs are trash when the holders think the divs might stop

    dont be fooled by the charts or the 1000's of con men talking about 'safe' high yield, complete with charts and graphs and cash flow bs
    They are all snake oil salesmen
  6. xandman


    I hear you. I am just turning rocks.

    The seniority of the preferred stock won't matter when these companies blow up.

    Still wondering about the chart, though. Everything I have read about preferred stock involves fixed income calculations. I don't recall ever looking at a preferred chart ever. I just expected it to track some bond benchmark +- a spread.

    I will try to PM @Martinghoul.