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August 2020
Preferred Securities in a Post-LIBOR World ►

There are far-reaching implications for many preferred securities should the London Interbank Offered Rate (LIBOR) be phased out at the end of 2021, as scheduled. Those that carry LIBOR-based payment resets have contingency “fallback” language, which isn’t always favorable to investors. Portfolio manager Jerry Dorost discusses the team’s thinking and active approach to managing these risks.

August 2020
Strength and Sustainability: U.S. Bank Preferred Dividends ►

Despite a challenging economic backdrop, most U.S. banks have managed to build their reserves and  remain profitable. Portfolio manager Jerry Dorost discusses the team’s analysis and why they see U.S. bank preferred dividends as sustainable, even with the introduction of a new Fed dividend test.

July 2020
3 Developments Supporting European Preferreds ►

European banks offer among the highest income rates within the global preferred market.  Portfolio Manager Elaine Zaharis-Nikas discusses regulatory and fiscal actions that should be supportive factors for these banks and their preferred payments to investors.

June 2020
Preferred Securities in a Post-LIBOR World

We expect the London Interbank Offered Rate (LIBOR) to be phased out at the end of 2021, though the COVID-19 pandemic could affect the schedule. Markets are slowly transitioning to alternative benchmarks, but uncertainties remain, as a clear path forward on the transition has not yet been reached among the many stakeholders.

April 2020
5 Questions for Preferreds in the Pandemic

As investors continue to gauge the impact of COVID-19, we offer our thoughts on key issues affecting the global preferred securities market, including the health of U.S. and European banks, insurance company exposures, default risk and high yield market comparisons.

March 2020
Preferred Securities and COVID-19

We believe the selloff is creating attractive opportunities for preferred securities investors to earn high levels of income from issuers with exceptionally strong balance sheets that are well positioned to defend in a time of economic disruption.

January 2020
The Case for Preferred Securities

Many preferred securities (also known as capital securities or hybrids) offer yields of 5–6% or more, largely from investment-grade issuers, yet the complex and often misunderstood asset class is typically underutilized by institutional investors. 

November 2019
The Case for Preferred Securities

Preferred securities are fixed-income investments, but with certain equity characteristics such as deeper subordination in the capital structure. Investors are compensated with notably high rates of income. Despite preferreds’ long stated lives, abundant fixed-to-floating-rate preferred instruments can significantly diminish interest-rate risk in diversified portfolios. Since many preferreds pay legal dividends, preferreds can also offer significant tax advantages.

October 2019
Why Preferreds and High Yield Make a Great Pair

With many investors turning to risky bonds for yield, being diversified may be more important than ever. For a more balanced portfolio, consider pairing high yield bonds with preferred securities, which typically offer attractive yields and have distinct characteristics that may complement traditional fixed income holdings.

October 2019
Diversifying High Yield With Preferred Securities

With many investors turning to risky bonds for yield, being diversified may be more important than ever. Investors should consult their investment professional about the potential benefits of pairing high yield bonds with preferred securities, which often pay attractive tax-advantaged income and have distinct characteristics that may complement traditional fixed income holdings.

October 2019
The Case for Preferred Securities in an Institutional Asset Allocation

Many preferred securities offer yields of 5–6% or more, largely from investment-grade issuers, yet the complex and often misunderstood asset class is typically underutilized by institutional investors. We discuss how preferreds may improve income profiles and risk-adjusted returns within diversified portfolios due to their unique and complementary characteristics.

August 2019
Diversifying High Yield With Preferred Securities

With many investors turning to risky bonds for yield, being diversified may be more important than ever. Investors should consult their investment professional about the potential benefits of pairing high yield bonds with preferred securities, which often pay attractive tax-advantaged income and have distinct characteristics that may complement traditional fixed income holdings.

June 2019
Two Strategies From a Leading Manager of Preferred Securities

Cohen & Steers has been at the forefront of active investing in preferred securities for more than a decade. For investors seeking the benefits of preferreds, including the potential for high and tax-advantaged income, we offer two Strategies: Preferred Securities and Low Duration Preferred Securities.

June 2019
Two Funds From a Leading Manager of Preferred Securities

Cohen & Steers has been at the forefront of active investing in preferred securities for more than a decade. For mutual fund investors seeking the benefits of preferreds, including the potential for high and tax-advantaged income, we offer two products: Cohen & Steers Preferred Securities and Income Fund and Cohen & Steers Low Duration Preferred and Income Fund.

December 2018
CoCos in Context: An Introduction to Contingent Capital Securities

Contingent capital securities (CoCos) have been the fastest-growing segment of the preferred securities market in recent years, with income rates often competitive with high-yield bonds. These securities are issued mostly by large, well-regulated financial companies to satisfy stricter capital requirements in the wake of the financial crisis and have become increasingly accepted by the market.

December 2018
CoCos in Context: An Introduction to Contingent Capital Securities

Contingent capital securities (CoCos) have been the fastest-growing segment of the preferred securities market in recent years, with income rates often competitive with high-yield bonds. These securities are issued mostly by large, well-regulated financial companies to satisfy stricter capital requirements in the wake of the financial crisis and have become increasingly accepted by the market.

August 2018
How Institutional Investors Can Benefit From Preferred Securities

Many preferred securities offer yields of 5–6% or more, largely from investment-grade issuers, yet the complex and often misunderstood asset class is typically underutilized by institutional investors. We discuss how preferreds may improve income profiles and risk-adjusted returns within diversified portfolios due to their unique and complementary characteristics.

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Cohen & Steers is a global investment manager specializing in liquid real assets, including real estate securities, listed infrastructure, commodities and natural resource equities, as well as preferred securities and other income solutions.

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