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Seaspan Corporation: A Low-Risk 5.48% Yield-To-Maturity For One Year


  • Brief introduction of the company itself, the products of interest to us and how they compare to one another.
  • One of Seaspan's baby bonds popped up as a good candidate for our portfolio.
  • Explaining why and how to carry out the trade.


The market continues with its huge, sharp highs and lows which makes every investor weary of whether her or his money are in a safe place. Because of that, we managed to find a calm place for our money in one of Seaspan Corporation's (SSW) baby bonds.

The Company

Seaspan Corporation, incorporated on May 3, 2005, is an independent charter owner and manager of containerships. The Company charters pursuant to long-term, fixed-rate time charters with various container liner companies. As of February 20, 2017, it had operated a fleet of 88 containerships and had entered into contracts for the purchase of an additional eight new building containerships.


The Company is engaged in the operation and management of vessel, including maintaining the vessel, periodic dry-docking, cleaning and painting and performing work required by regulations. The Company also provides limited ship management services to Dennis R. Washington's personal vessel owning companies, and ship management and construction supervision services to Greater China Intermodal Investments LLC.

Source: Reuters.com - Seaspan Corporation

Source: Barchart.com - SSW Daily Chart (1 year)

The common stock has performed well enough in the past year since it bottomed in the middle of 2017 for us to consider the preferred stocks. There is not much more we can add in terms of value as to whether the company is priced correctly in the market and such, and it is completely outside our area of expertise. Therefore we will let the following chart speak for itself and focus on the places where we can contribute in terms of knowledge.

The Seaspan Corporation Family

Source: Author's database

As you can see the family of the company is not small and there are various preferred stocks ''brothers''. Today in our trade proposal I am going to introduce you to SSWN - the baby bond. And

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This article was written by

Arbitrage Trader profile picture
Leader of Trade With Beta
Income arbitrage ideas along with managed portfolios and pair trades

Day trader whose strategy is based on arbitrages in preferred stocks and closed-end funds. I have been trading the markets since I started my education in Finance. My professional trading career started right before the big financial crisis of 2008-2009 and I clearly understand what are the risks the average investor faces. Being a very competitive trader I have always worked hard on improving my research and knowledge. All my bets are heavily leveraged(up to 25 times) so there is very little room for mistakes. Through the years my approach has been constantly changing. I started as a pure day trader. Later I added pair trades. At the moment most of my profits come from leveraging my fixed income picks. I find myself somewhere in between a trader and an investor. I am always invested in the markets but constantly replace my normally valued constituents with undervalued ones. This approach is similar to rebalancing your portfolio and I just do this any time there is some better value in the markets. I separate my trading results from my trading/investment results. I target 40% ROE on my investment account and since inception in 2015, I am very close to this target.

My main activity is running a group of traders. Currently, I have around 40 traders on my team. We share our research and make sure not to miss anything. If there is something going on in the markets it is impossible not to participate somehow. Some of my traders are involved in writing the articles in SA. As such Ilia Iliev is writing all fixed-income IPO articles. This is part of their development as successful traders.

My thoughts about the market in general:

*If it is on the exchange it is overvalued and our job is to find the least overvalued.

*Never trust gurus - they are clueless.

*Work hard - this is the only way to convince yourself you deserve success.

*If you take the risk it is you who has to do the research.

*High yield is always too expensive.

We are running a service here on SA. It is a great community with very knowledgable people inside. Even though we are not in the spotlight as often as we would like to our articles' results are among the strongest on SA. You can always contact me to share some of our articles and best picks so far.

Analyst’s Disclosure: I am/we are long SSWN. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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