Preferred Market Overview
With interest rates continuing to remain at historic lows, investors have been looking for investments that offer higher yields than common stocks and bonds. Since preferreds meet this condition and have shown relatively low price volatility, the asset class has been a benefactor of investor demand. The preferred market in Canada grew to an estimated CAD 61.5 billion at the end of the year in 2013, doubling in size since year-end 2008. The exhibit below shows the growth of the Canadian preferred market over the past five years.
This article was written by Philip Brzenk, Associate Director, Index Research & Design, S&P Dow Jones Indices.
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