GMP Capital Inc. Cumulative Floating Rate Preferre T.GMP.PR.C

RE:JERRY

[jjeerryy]

RetsilRube, you are obviously posting your thoughts as fact and you surely did not read what I posted:  'You cannot use the 'anonymous selling' argument because any and all brokers can use that anonymous desigation if they feel the need to protect their client and they do so fairly freely. I have seen stocks of mine get filled either the bids or the asks and seen on the TSX pages the sale of the time and seen it listed as anonymous buying or selling when I never did ask to have my bid or ask set as anonymous. Are you totally uninformed or hoping to snag someone who is?'

Stuff your con where the sun does,'t shine!
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RetailRube wrote: Please don't yell at me Jerry.  I am a retail investor with a very simple order entry screen.  Unlike the big boys, I don't have a switch on my screen where I can turn on the anonymous flag and disguise my trades.

I own a full position of Pref shares and zero common shares.  I would like the pref shares to go up, but I am patient.  I think this is a once-in-a-lifetime chance to get pref shares at their all-time low price to sock away some cheap inflation protection.  That is because GMP.PR (for example) will rate-reset in March 2021, probably close to zero for the 5 year Gov't of Canada bond.  Right now 90 day t-bills yield 0 bps.  Maybe we get lucky and get 40 bps on the 5 year.  Therefore 2.9% + 0.4% = 3.3% x $25 = $0.825/year dividend.  At the current price, the yield will be 10%.

But I worry about inflation coming back.  Factories which where built to run with people standing shoulder to shoulder now have to space people 6 feet apart.  That raises their costs and cuts output.  I see price rises coming to maintain corporate profits.  Same problem with restaurants.  Stockholm restaurant prices here we come.  When the 2026 reset comes, the adder could be a lot higher than 40 bps.  Then the pref share price takes off like a rocket.  For me, these shares are some inflation insurance.

I thought the 1Q results were ok.  Not as bad as I thought it might be.  Greater commentary on why they delayed completing the ownership reorg were appreciated by this shareholder.  Fortunately GMP continues to pay the dividends on the pref shares.  Probably because they can only defer payment ... they cannot skip the payment or cut them in half.

(I recall that Benj owned the pref shares in his holdings.  Maybe also the common.  He is why I started looking at pref shares.)