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The Royal Bank of Scotland Group plc Message Board

  • jblau1 jblau1 Jan 28, 2013 2:30 PM Flag

    What is wrong with RBS.Q pfd

    It just keeps going down. What is the cause? I just bought it last week and it has gone down everyday. Can anyone explain it to me. Is it a good investment in the long run? I was advised that it is.
    It is a long way from being called in at par. In a bull market like this one it should not be taking such a big hit. Your comments would be appreciated. I have no long term sentiment.

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    • Goldman cut RBS to sell and it affected the debt a bit. I don't see the Q's acting out of step with the rest of the hybrid shares. Those are ADR's so you get hit with a little fee.

      Frankly, I see the risk / reward being a bit weak here. I bought some DB preferred at 7.40% in December. I'm just holding RBS Cap Trust shares, at a low basis as, I await my plump dividends or full repayment.

    • I am replying to my own message because no one else seems to want to make a comment. recently in the Wall Street Journal there was a statement that talked about the problems with RBS and Libor. It would be benificial if someone else would comment on when they feel that RBS and the RBS Q and other pfds will be good investments.

      • 2 Replies to jblau1
      • Don't worry. I traded my L series purchashed for 3.40 (March 09) for Q series in April for great gains in appreciation as well as yield and have been adding since. Want another 250 to make up 5k to go with 5k in T series ( I traded in my H series that I held since 2002 for no difference in yield but the chance to get that same yield with a few thousand bucks free to buy some Q seies) I also have 5k in BCS D series averaged at $23.

        Bottom line, I don't think they'll raise the money to call these in any time soon. Ifthey call the F and H in, then I'll start to pay attention. As with BCS D callable this year, they haven't even called in the BCS 6.625% that should have been called in at the end of 2011.

        Meanwhile, I'm enjoying $2300 a month in qualified divies. While disturbed at a little lose to the capital gains, I am so far in the green on these that I welcome any chance to fill up the remaining 250 that i want at under $24.

        Sentiment: Strong Sell

      • I have been somewhat successful in trading the preferreds ( well holding more than trading) off and on for several years since 2009. I also accumulated the common. I have seen nice runups on all including the "maypays" and the ABNs. Closed out the bulk of my positions today. I think the LIbor issue is spooking many holders. I may get back in a bit later after the dust settles but the bulk of the run up has already occurred. You might look at the SFI preferreds which I have held for 4 years. Clearly people are now recognizing the modest risk v substantial reward that exist there. Good luck. You my look at RSO-B or NRF-B for other attractive alternatives.

    • rbs pfds come in 2 flavors. one is much more likely to be paid than the other. all the less likelys(like Q) are down a bit. next time buy the safer ones. only a bit less interest.

      • 1 Reply to taintedfud
      • I have owned RBS.Q since it was at $18. Most preferreds do not trade much above $25 because of the possibility of being called. The recent $1 pull back is normal noise. At todays price you will earn about 7.1% interest and over the next year you might get a 8% capital gain. Not bad in todays low interest rate environment.

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