Opportunities in Preferred Securities
Investors’ search for investment income is not new. It has become a more important discussion after the 2008 financial crisis as yields plummeted during the age of Quantitative Easing by the Federal Reserve. Corporations were able to fund debt at historically low levels and some foreign governments issued debt with negative yields. Investors were left with hat in hand, searching for opportunities to enhance yields on portfolios without adding significant risk, or at least diversifying their risk appropriately. While some began taking a closer look at the preferred sector at this time, the team at Red Cedar had been managing the sector since 2002. Their experience in this unique sector has helped them to understand the nuances and opportunities that exist in a widely misunderstood asset class.