Preferreds/Bond Weekly Review: PennyMac Mortgage Preferreds Stay Fixed

ADS Analytics Investing Group Leader Follow Summary We take a look at the action in preferreds and baby bonds through the third week of August and highlight some of the key themes we are watching. Preferreds credit spreads remain tight, but median yield-to-worst has risen as long-term rates increase, favoring fixed-rate over floating-rate preferreds in some cases. The Ninth Circuit ruled in favor of PennyMac Mortgage Investment Trust, allowing fixed coupons on LIBOR Fix/Floating preferreds post-LIBOR cessation. Saratoga issued a new 8% 2031 bond and is redeeming its lowest-coupon, shortest-maturity bond, prioritizing liquidity amid sector-high leverage. MITT and CHMI merger increases agency MBS exposure, derisking the portfolio; MITN and MITP bonds remain attractive with yields around 9.2%. I do much more than just articles at Systematic Income: Members get access to model portfolios, regular updates, a chat room, and more. Learn More » FabrikaCr/iStock via Getty Images Welcome to another installment of our Preferreds / Bond Weekly Review, where we discuss preferred stock and baby bond market activity from both the bottom-up, highlighting individual news and events, as well as top-down, providing an overview of the broader market. We also This article was written by ADS Analytics 13.71K Followers Follow ADS Analytics is a team of analysts with experience in research and trading departments at several industry-leading global investment banks. They focus on generating income ideas from a range of security types including: CEFs, ETFs and mutual funds, BDCs as well as individual preferred stocks and baby bonds.ADS Analytics runs the investing group Systematic Income which features 3 different portfolios for a range of yield targets as well interactive tools for investors, daily updates and a vibrant community. Analyst’s Disclosure: I/we have a beneficial long position in the shares of MITP either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.