Allianz Global Investors has sold a new super high quality preferred stock in its Convertible & Income Fund II (NYSE:NCZ) with a coupon of 5.5%.
These types of preferred stocks are likely to get knocked down quite a bit as interest rates move higher, but there are no higher quality preferreds in the marketplace–in our opinion. So if one wants to lock in income and has less sensitivity to net asset values this one is for you.
This issue fits in with other preferreds from closed end funds (CEF) in that they must maintain an asset coverage ratio of 200%. The issue fits in with many issues from the various Gabelli companies.
Note that our list does NOT include issues from BDCs which are technically closed end funds–but very different from closed end funds that invest in stocks and bonds traded in public markets. BDCs mostly invest in Level 3 assets–these are the investments that management values (just trust them type assets) while this fund and the Gabelli funds mostly invest in Level 1 assets which have daily observable values (traded on public markets).
This issue has the normal terms–quarterly dividends payments, an early redemption ability beginning 9/11/2023 and cumulative dividends.
This issue has just begun trading on the OTC grey market this morning under the ticker NCZIP and last traded at $24.80.
Our thanks to Wedgehead for the heads up on the quick trading on this issue.