Bank of America Corp.'s Trust Preferred Securities About To Put More Money In Your Pocket

On 6/10/15, Bank of America Corp.'s Trust Preferred Securities (MER.PRM) will trade ex-dividend, for its quarterly dividend of $0.4031, payable on 6/15/15. As a percentage of MER.PRM's recent share price of $25.59, this dividend works out to approximately 1.58%, so look for shares of MER.PRM to trade 1.58% lower — all else being equal — when MER.PRM shares open for trading on 6/10/15. On an annualized basis, the current yield is approximately 6.30%, which compares to an average yield of 5.69% in the "Financial" preferred stock category, according to Preferred Stock Channel.

START SLIDESHOW:
Click here to learn which S.A.F.E. dividend stocks also have preferred shares that should be on your radar screen »

As of last close, MER.PRM was trading at a 2.36% premium to its liquidation preference amount, versus the average premium of 1.64% in the "Financial" category. Investors should keep in mind that the shares are not cumulative, meaning that in the event of a missed payment, the company does not have to pay the balance of missed dividends to preferred shareholders before resuming a common dividend. The chart below shows the one year performance of MER.PRM shares, versus BAC:

Performance Comparison Chart

Below is a dividend history chart for MER.PRM, showing historical dividends prior to the most recent $0.4031 on Bank of America Corp.'s Trust Preferred Securities:

MER.PRM+Dividend+History+Chart

According to the ETF Finder at ETF Channel, Bank of America Corp. ( BAC) makes up 7.85% of the iShares U.S. Financial Services ETF (IYG) which is trading lower by about 0.4% on the day Monday.

In Monday trading, Bank of America Corp.'s Trust Preferred Securities ( MER.PRM) is currently trading flat on the day, while the common shares ( BAC) are down about 0.6%.

More from Stocks

Replay: Jim Cramer on the Markets, Oil, General Electric, Zillow and Micron

Replay: Jim Cramer on the Markets, Oil, General Electric, Zillow and Micron

Pegasystems Founder Explains Why He Has One of the Hottest Tech Stocks Around

Pegasystems Founder Explains Why He Has One of the Hottest Tech Stocks Around

Micron Shares Soar; Chipmaker Is 'Managing for Profitability' Now, Says Analyst

Micron Shares Soar; Chipmaker Is 'Managing for Profitability' Now, Says Analyst

Dow Slips 178 Points; S&P 500 and Nasdaq Also Decline

Dow Slips 178 Points; S&P 500 and Nasdaq Also Decline

Facebook CEO Mark Zuckerberg Deflects Tough Questions From European Parliament

Facebook CEO Mark Zuckerberg Deflects Tough Questions From European Parliament