This video will go over Split Share Corporations and point out some of the facts you should know as an investor.
Split Share Corporations – How to Select the Best Stock
Navigate to the free canadianpreferredshares.com or premium website. For this video I will be using the free site.
Select “Split_shares” from the main menu.
Here you see a table of links to each “split share corporation” stock available today in the canadian market.
Each of these links will take you to the page loaded with information on this particular share.
Now click the button “Compare All Class A Shares of Split-Share Corporations” to get to the compare tool.
Scroll down the page till you get to the Compare Table.
. First notice the Pink hilited rows
. Sort table by Current Yield by clicking the column heading
Class A shares, only pay dividends if the Net Asset Value of the split-corporation is greater than the Threshold value.
The compare tool has already identified and highlighted in pink those with a NAV below the Threshold.
In this case stocks OSP and WFS as of today do not pay a dividend. The possible yield for OSP at the current price is 67.42% but in reality its 0%.
In addition the “Class A Nav” as was last calculated by “Brompton Funds” on Jul 25th,2021 is $0. This stock is currently trading in the market at $1.78.
In short ignore all stocks in pink and look for the next available line. In this case its row 3 Stock DF (Dividend_15_Split_Corp_II).
Quadravest does not report seperate “Class A” and “Preferred” NAV, instead they provide a combined one. Since the NAV of the preferred is a few cents over $10 dollars we can calculate the “Class A” NAV as $15.56 – $10 = $5.56. Class A was last traded at $6.34.
With a NAV of $15.56 and a Threshold of $15.0 “DF” is very close to not paying dividend, hence the high yield of 18.93%.
Lets take a look at LBS. The “Class A Nav” as was last calculated by “Brompton Funds” on Jul 24th,2021 is $9.57. This stock is currently trading in the market at $9.66.
The “combined NAV” is $19.70 with a threshold of $15.00. The current yield is 12.42%. This is a lower yield but a lot safer than “DF”.
Use these columns as I have done, to select the share that fits your risk profile and offers the best yield for the risk you are willing to take.
Thank you for watching and Happy Investing!