Canadian Originated Preferred Securities (COPrS)

What is ‘Canadian Originated Preferred Securities – COPrS’

A long-term subordinated debt instrument issued in Canada. COPrS (pronounced “coppers”) are a type of derivative equity security invented by Merrill Lynch in the mid-1990s. The first company to offer them was TransCanada PipeLines. COPrS are not the same as preferred shares, but are attractive because they have features which resemble both preferred shares and long-term corporate bonds.

Explaining ‘Canadian Originated Preferred Securities – COPrS’

COPrS are a form of long-term, unsecured debt that are rated like bonds. They are traded on the Toronto Stock Exchange and pay interest quarterly, though the issuer usually has the option to defer paying interest for as many as 20 consecutive quarters. COPrS can be called after five years, so they are subject to reinvestment risk. Their subordinate status adds another level of risk, but also they offer a higher yield, and they are taxable investments.

Further Reading

  • An index of financial stress for Canada – [PDF]
  • Separation of ownership from control and acquiring firm performance: The case of family ownership in Canada – [PDF]
  • Legal origins, politics, and modern stock markets – [PDF]
  • The Canadian underground economy: An examination of Giles and Tedds – [PDF]
  • Federal finance and fiscal federalism: The two worlds of Canadian public finance – [PDF]
  • Prevalence and sociodemographic risk factors related to household food security in Aboriginal peoples in Canada – [PDF]
  • Legal Origins: Reconciling Law & (and) Finance and Comparative Law – [PDF]