Financial 15 Split Corp T.FTN

FTN vs. FFN?

[canoehead]

There are some posters on these boards who are obviously more knowledgable than me about these split shares. If any have a few minutes could you outline your pros and cons and what you think the risk reward ratio is for different units. TIA, much appreciated?

[EdPaquette]

I'll put this in canoe terms. FTN has more freeboard, so less likely to get swamped.  FFN has a higher yield so more risk and more rewarding.

[mouserman]

I do believe for those investors who want a split fund common with decent income FTN is the safest, and porbably not one you have to watch or trade.  FFN on the other hand is a higher yield, at almost exactly 19% , but is trading at a premium, and has only about $1.40 of safety. It is my biggest holding, and i am in at an average price of about $5.50 with trading . If the premium gets too

[canoehead]

Thanks Ed and mouserman. Great info. I think I will get my feet wet by taking equal dollar positions in each to watch and see how it goes. Do you think the premium of 11.7% on FFN is getting into sketchy territory or does it usually trade around that high due to the high payout?

[EdPaquette]

Markets zig and zag. If things keep rising, FFN is best. In a pullback FFN might miss some distributions. FTN is more stable. 

[canoehead]

Excellent ED! More canoe analogies. It always zigs and zags, you just hope you get where you are trying to go as you enjoy the adventure. Thanks for your help.

[mouserman]

A premium of 10 to 15% is not real bad for high yielding splits that have over a 1$ of safety factored in, and banks and lifecos are quite safe, especially given the current valuations, and stellar Q reports from those. I generally dont hold splits that carry a premium of more  than 20% above the real NAV of the common shares. DGS at the valuation today i consider sketchy as it is currently