Ready to understand the real power of equity investing in the Canadian stock market? In this insightful episode of Money Talks: Your Guide to the Canadian Securities, your knowledgeable host Rita and financial expert Alexis Goldbloom pull back the curtain on Common Shares and Preferred Shares!
Discover what it truly means to be an owner of a public company, understanding the benefits and risks of common share ownership including voting rights, capital appreciation, and dividend income. We’ll demystify corporate actions like stock splits and consolidations, showing how they impact your holdings without changing your overall investment value.
Then, dive into the fascinating world of Preferred Shares – the equity-bond hybrids! Learn their unique features, from fixed dividends and asset preference to complex types like fixed-rate perpetual, floating-rate, and fixed-reset preferred shares. Alexis will break down the crucial risks of preferred shares for investors, including interest rate risk, call risk, and liquidity risk.
Plus, we explore a fantastic Canadian investing innovation: Canadian Depositary Receipts (CDRs), offering you access to major U.S. and global companies in Canadian dollars with a built-in currency hedge. Finally, we'll summarize the important Canadian stock market indexes like the S&P/TSX Composite and S&P/TSX 60, crucial for measuring market performance and building Canadian ETFs.
This episode is essential for beginner investors and seasoned pros alike, aiming to boost your securities education and financial literacy. Whether you're optimizing your RRSP or TFSA strategies, or just keen to understand market regulations and how companies raise capital beyond IPOs, Money Talks is your expert guide to investing smarter in Canada!
Key Takeaways:
[01:30] The essence of Common Shares: Ownership, benefits, and risks for investors
[04:00] Understanding Stock Splits & Consolidations (and how they affect your portfolio)
[07:15] Introduction to Preferred Shares: A hybrid investment with unique features
[09:40] Deeper dive into Preferred Share types: Fixed-rate, floating-rate, and fixed-reset preferreds
[13:50] Why companies issue preferred shares & why investors buy them (yield, tax benefits, diversification)
[16:20] Key risks of preferred share investing (interest rate, credit, call, liquidity)
[19:00] Exploring Canadian Depositary Receipts (CDRs): Global stocks in CAD with a currency hedge
[22:00] The role of Canadian stock market indexes (S&P/TSX Composite, S&P/TSX 60)
