The Fed's rate hike and recent comments and rising bond yields are causing discounts in some preferred shares. The price of this series is now ~17% below its $25 call value. It has a floating rate feature, which will protect investors against rising rates, and may lead to a windfall profit down the road.
As part of the HDS+ portfolio holdings, NuStar Energy L.P. 8.50% Series A Fixed/Float Cumul. Red Perp Preferred Units (NYSE:NS.PA) and NuStar Energy L.P. 7.625% Series A Fixed/Float Cumul Red Perp Preferred Units (NYSE:NS.PB) have both been further discounted by the market recently, due to the Fed's .25% rate hike and rising bond yields. NuStar Energy L.P. 9.00% Series C Fixed/Float Cumul Red Perp Preferred Units (NYSE:NS.PC) also has fallen a bit as well.
Source: Seeking Alpha
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