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Author: yodaorange Big red star, 1000 posts Feste Award Nominee! Feste Award Winner! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 77266  
Subject: STUNNING loss for CMO preferred Date: 5/8/2013 8:33 PM
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CMO-pB suffered a 17.7% loss today. CMO announced they MIGHT use some of the proceeds from a new offering to do a partial or full call. CMO-pB closed Tuesday at 15.30. It has a par value of 12.5. It closed today at 12.59. It has been callable for many years.

BOTTOM LINE is that you should NOT assume old preferreds will NOT be called. It is easy to get lulled into a false sense of security, particularly those with high coupon rates. This issue had a 10%+ coupon. Investors bid the price up while searching for yield. Very ugly.

DO NOT LET IT HAPPEN TO YOU!

Thanks,

Yodaorange
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