We all knew it was coming and it has happened with Allstate announcing the redemption of 6.625% issues ALL-D, ALL-E and 6.25% ALL-F.
When I say “we all knew it was coming” I am maybe speaking too broadly because the ALL-D 6.625% issue is trading at $26.76 and the ALL-F 6.25% issue is trading at $25.84. Maybe I am going crazy–but I fail to understand folks trading a security at $26.76 when it has reached the optional redemption period and the company had just sold an equivalent 5.10% issue. Do we have that many ‘rookies’ in the market now? Look at the trading in the ALL-D issue here. I wrote on 8/1 when the 5.10% issue was announced that “folks were asleep at the wheel” and from the chart you can see they woke up and sold the ALL-D issue hard—and then the buying started anew. Qeez.