Untraded closed end fund (CEF) Priority Income Fund has called their 6% PRIF-H for redemption on April 9, 2025–the mandatory redemption on this one was scheduled in 12/2026.
This is the 2nd term preferred that PRIF has redeemed early in the last 4 months. They redeemed the PRIF-G 6.25% issue in December, 2024. It had a mandatory redemption in 6/2026.
It is quite obvious that PRIF is making these calls based on the mandatory redemption dates–not by coupon. These are generally smaller issues–a million shares or so – not a big hardship on a CEF with total assets of over 900 million to call. I believe the next issue they will redeem is the 6.625% PRIF-F issue–this is the issue with the next mandatory redemption which is 6/30/2027. This issue is currently callable and trading at $24.38. I will immediately try to buy some of this issue since our H shares are being called.
Disclosure–we own shares of the PRIF-H 6% issue in 2 accounts.
Is this a good thing or a bad thing? If my PRIF-F ever gets called I would be delighted. Risk off. Except I don’t feel like paying taxes on the profit.