Fri. Sep 22nd, 2023
    Understanding the Value of NYSE:ATH^D Athene Holding Ltd. Depositary Shares

    The NYSE:ATH^D Athene Holding Ltd. Depositary Shares are a unique financial instrument that represents a fractional interest in a specific series of preferred shares. Each depositary share signifies a 1/1000th interest in a 4.875% fixed-rate perpetual non-cumulative preference share series D. This unique financial product is listed on the NYSE stock exchange and offers investors an alternative way to invest in Athene Holding Ltd., a leading retirement services company.

    To fully appreciate the value of these depositary shares, it is crucial to understand what they represent. Each depositary share corresponds to a fraction of a preferred share. Preferred shares are a type of equity security that has properties of both an equity and a debt instrument and is generally considered a higher-ranking security than common shares. They typically come with a fixed dividend, which is what the 4.875% in the name refers to. This means that holders of these shares are entitled to a 4.875% dividend yield.

    The term “perpetual” indicates that these preferred shares have no maturity date. In other words, Athene Holding Ltd. is under no obligation to redeem these shares. This feature provides the company with a consistent source of capital, as it does not have to worry about repaying the principal amount. On the other hand, it offers investors a potentially infinite investment horizon, allowing them to collect dividends for as long as they hold the shares.

    The “non-cumulative” aspect of these shares means that if Athene Holding Ltd. decides not to pay a dividend in any given period, it is not obligated to make up for it in the future. This characteristic can be a double-edged sword for investors. On one hand, it can lead to a loss of income if the company decides to skip a dividend. On the other hand, it provides the company with financial flexibility, which can be beneficial for the overall health of the company and, by extension, for the long-term value of the shares.

    Investing in NYSE:ATH^D Athene Holding Ltd. Depositary Shares also offers the advantage of diversification. As they represent a fractional interest in preferred shares, they allow investors to spread their investment across a larger number of shares than if they were to buy the preferred shares directly. This can help to reduce risk and increase the potential for returns.

    In conclusion, the NYSE:ATH^D Athene Holding Ltd. Depositary Shares offer a unique investment opportunity. They combine the features of preferred shares with the benefits of diversification and a potentially infinite investment horizon. However, like all investments, they come with their own set of risks, including the possibility of missed dividends due to their non-cumulative nature. Therefore, potential investors should carefully consider their investment goals and risk tolerance before investing in these shares.