RE:RE:RE:Quarterly Concurrent RetractionDGS is the only split share that features a Quarterly Concurrent Retraction privilege. This allows all investors to redeem their shares every three months at NAV, but you must redeem an equal number of both classes of shares together.
These retractions are not always profitable as it is sometimes better to simply sell your shares into the market. One example of this was the Annual Concurrent Privilege for DF a few months ago in which I participated. One could have sold their capital shares for $4.15 and their preferreds for $9.85, for a total of $14.00 before the deadline. The redemption price, however, ended up being only $13.84. More importantly, while one waited a month for the proceeds of the redemption, one could have repurchased the same holdings for about a dollar cheaper!
Another failure was FFN soon after. One could have sold the capital shares for over $3.00 and the preferreds for $9.82 for a total of $12.82. However, the redemption price was only around $12.72. Again, one could have replaced their holdings for about $0.35 cheaper while waiting for the proceeds of the retraction. Thankfully, did not participate.
There are numerous factors one needs to consider, but a thorough explanation is beyond the scope of this forum.
alder wrote: I'm confused.
The Brompton site from the Preferred Share Primer states :
Preferred Shares are redeemable at the shareholders option at the end-of-term.
Is there a difference between retraction and redeeming ?
Otherwise it certainly sounds like it can only be done at maturity.
Regards
Alder