For the second time in 6 years, High Rock Capital initiated a Preferred Share Opportunity Mandate. This was created, like it was in the Fall of 2017, to take advantage of the dislocation in the Preferred Share market. We presented the opportunity to a specific sub-set of our clients who this was suitable for last October 2023 and began investing in the mandate in early November 2023. It is important to note that all our clients (in our Balanced Mandates) had a large “overweight” in Preferred Shares over the same period so benefited all the same.
Preferred Shares are the most complex cash security instrument in the country, and compounded by Investment Advisors who, in my opinion, do not understand the complexities that exist, as well as the fact they get paid 3% upfront commission to buy them on a new issue basis for their unsuspecting clients. This creates dislocation, and opportunity.
High Rock has a proprietary excel model for valuing these complex securities, which has been in force since the summer of 2017. It is an excellent tool, to say the least.
We can’t talk specifically about performance, but if you want to learn more about our process, please reach out. Note – Past performance is not a guarantee or indication of future performance and all mandates need to be suitable for clients.