If you're a belt-and-suspenders kind of income investor, then solid convertible preferreds are right up your alley, and these two are prime examples of good yields with preferreds' safety, writes Richard Lehmann of Income Securities Investor.

General Motors Company 4.75% Preferred (GM.B)
Current Yield 7.82%

Dividends from this Mandatory Convertible Junior Preferred Stock are cumulative and can be paid in cash, or subject to certain limitations, in common stock or any combination thereof.

On December 1, 2013, this issue will be mandatorily convert to 1.2626 shares of common stock if the common is at or above $39.60. If the common is at or below $33.00, the conversion rate will be 1.5152. Between the two common prices, holders will receive $50 worth of common.

This 87 million share issue, part of the emergence package of General Motors (GM) from bankruptcy, offers investors an opportunity to earn a high return while waiting for the common stock to move up. Since we last recommended this convertible, GM stock has been hit hard, and the issue has suffered a sharp decrease. The low premium and high yield makes this issue very attractive.

Remember the federal government still owns over 30% of GM. This security is for high-risk investors seeking income and growth. Buy up to $36.

United Technologies Corporation 7.50% Preferred (UTX.A)
Current Yield 7.11%

On August 1, 2015, these equity units will mandatorily convert to .5075 shares of common stock if the common is at or above $98.51. If the common is at or below $74.35, the conversion rate will be 0.6725. Between the two common prices, holders will receive $50 worth of common.

United Technologies (UTX) provides a broad range of high-technology products and services to the global aerospace and building systems industries. Its commercial businesses are Otis elevators and escalators and UTC Climate Controls & Security, a leading provider of heating, ventilation, air conditioning, fire and security systems, building automation and controls. Their aerospace businesses are Sikorsky aircraft and the new UTC Propulsion & Aerospace Systems, which includes Pratt & Whitney aircraft engines and Hamilton Sundstrand aerospace products.

First-quarter 2012 revenue was $12.424 billion and net income was $330 million. For the same period in 2011, revenues were $12.680 billion and net income was $1.012 billion. This issue would offer both growth and income to a low-risk portfolio. Buy at or below $55.

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