PrefInvestor wrote:OK so I have now concluded my consideration of MCT as an investment and decided not to proceed, for the following reasons:-
1. It seems to me that what you are investing in here is a preference share that pays you a fixed return of 1.275p a quarter and that actually what the company is invested in is pretty irrelevant to its investors. The concept that investing here is exposing the holder to the North American markets seems tenuous at best to me.
2. The prospectus as usual is complex and opaque and just might offer the company the ability to redeem at a price that might be unfavourable to investors, its difficult to tell. (Redemption risk). I have no wish to take this risk having been burned by this issue back in March with other prefs.
3. In practice there are many UK preference shares offering a yield of over 6% (ie better than MCT) that I would feel more confident about investing in than this, so no compelling reason to invest here.
PrefInvestor, MCT is mostly targetted at/gives greatest exposure to Canada.
I have held it for quite a few years, and chose it partly for its yield and particularly as a means to hedge against sterling weakness and capitalise on overseas earnings. It's dividends are enhanced when converted back to a weak £ sterling.