While we own only 2 perpetual preferreds personally and 1 is a fixed-to-floating rate issue there is still pain from time to time.
1 of our holdings had a big seller– Spark Energy 8.75% fixed-to-floating perpetual just dropped by a buck.
Guess they wanted out pretty bad. Given that the shares represent 1% of our holdings for us there is modest pain, but it does show what can happen to these high yield issues with thin trading.
While we don’t build our personal portfolios with a bunch of high yield issues (quite the contrary) if you look at the partially invested High Yield Portfolio you can see that a hit like the above mentioned can take a chunk quickly.