Some of our readers caught the ‘formal’ call of the AXIS Capital (AXS) 5.50% perpetual preferred (AXS-D) which was released yesterday. The issue will be redeemed on 1/17/2020.
I had owned a full position in this issue for a portion of this year as it was trading around $25 plus accrued dividends so I anticipated it being called at some point in time, but took advantage of the reduced volatility and issue like this provides to garner a safe 5.50% dividend for a few quarters.
The company had sold a $1000 subordinated note earlier this month and stated the intent to call the AXS-D issue. Investors need to remember that such disclosure in a filing for a new issue isn’t a formal call–that will be done separately with all the details of the call.
In this case after the subordinated notes were sold we put in a limit order to sell our position at a price that I guessed would be about the final realization of value based on a guesstimate of call date. I sold 60% of the holding, but will be carrying the last 40% into the official redemption date of 1/10/2020 when I will receive $25.176/share.
This issue has now stopped trading under the original ticker and is trading under AXS.PR. D.CL (or some such symbol depending on the broker). Currently quoted at 25.13 bid and 25.15 ask.