No cyclerider it is not a guarantee that the prefs will be converted, its a possibility definitely: and for this eventuality I have already done my margin of safety.
There are other possibilities they could do:
a) extend the prefs and pay a higher interest rate
b) do a buy back on market to reduce the pool of prefs
c) recall all the prefs at face.
d) the eventuality that you are talking about: conversion is obviously the least desirable for me, but even under this scenario I should do ok baring a residential property crash (this is my biggest risk). This has again been discussed in my previous thread, so I wont go into the details again.
Greater clarity will occur in late 2022.
Yes pref dividends reduce the value of the NTA of the ords, but the loss is not proportional to the pref holders. Essentially once covid finishes, and with low interest rates, residential property should continue to do very well. This will increase the value of the NTA.
No cyclerider it is not a guarantee that the prefs will be...
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