BOND THREAD

[starrynight]

Yah, I saw that each pip is $200 even for the mini contracts

I know I can buy/short VIX index. But it is very volatile. Because of Our weakness emotional trading behaviour, trading VIX is a NO. Chances 99% will lose in long run. I prefer VIX fund which now trading a low price where S&P index is trading a record high price.



rdgs,
Vic

[buttercarp]

Usually for a hot IPO / bond issuance, some people will apply for more than they want cos they know they are likely to get only a (small?) fraction of what they apply for.

Cornerstones sometimes have a lock-in period. IPO prospectus will have that info - I don't know for this one. But from what I can see, whilst I'm not familiar with some of them names, they look like they are in it for the long run.

As a retail investor, I will not chase this one if I don't get placement / retail offer. Don't know what the institutions will do

Strange trend for public offers in the past 6 months is that they tend to give a higher % likelihood of getting something to the people apply for smaller lots. Opposite of the usual practice in the past.

I'll likely try applying 500 lots.

Wow.... 500 lots !
That's $0.93 X 500000 = $465000!

How many lots do you think you will finally get?

For cornerstone investors there is NO lockup period for this reit.
See page 55 of prospectus.

[starrynight]

Thanks for the info re no lock-up!

I am aiming for 25 lots... I'm awaiting completion for the apartment I bought, so have a bit of cash lying around in the meantime before paying it out.

BTW, I'm aiming for a quick first day gain of 4 to 5c, and will let it go.

Wow.... 500 lots !
That's 0.93 X 500000 = $465000!

How many lots do you think you will finally?

For cornerstone investors there is NO lockup period for this reit.
See page 55 of prospectus.

[buttercarp]

Thanks for the info re no lock-up!

I am aiming for 25 lots... I'm awaiting completion for the apartment I bought, so have a bit of cash lying around in the meantime before paying it out.

BTW, I'm aiming for a quick first day gain of 4 to 5c, and will let it go.

Oic, you want to let go on 1st day!
So if reach $1 or more then you sell?

Best of Luck!

Btw this is Page 53 of prospectus.

Do you think it will affect the reit if they lose the case?
I am worried about this.
But some people say if read too much of prospectus will get too cautious and end up not buying.

[starrynight]

Yup, 98c I will sell already

Another post FYI. See also this.

Sorry, page 53 did not appear - can you resend?

Oic, you want to let go on 1st day!
So if reach $1 or more then you sell?

Best of Luck!

Btw this is Page 53 of prospectus.

Do you think it will affect the reit if they lose the case?
I am worried about this.
But some people say if read too much of prospectus will get too cautious and end up not buying.

[buttercarp]

Yup, 98c I will sell already

Another post FYI. See also this.

Sorry, page 53 did not appear - can you resend?

Thanks for the links.
Investment moats website - I like that guy and I follow his blog closely as part of my learning process of stocks.
The other one is new to me but I will read in detail.

Prospectus Link: H E R E

Their page 53 is page 69 out of 700 pages in my pdf version.
Hope you can locate it.

I copied and paste here for you.

"There is a pending appeal in relation to HK Gateway Plaza Company Limited which owns Gateway Plaza that may adversely affect the value of the Units.

There is a pending appeal before the Supreme People’s Court of China (“

Pending Appeal”) in relation to a claim for the return of an alleged loan of RMB210.0 million (that purportedly took place in June 2007), filed by Beijing Bestride Real Estate Development Co Ltd (“Bestride”) against HK Gateway Plaza Company Limited (“HK Gateway”) which owns Gateway Plaza (the “Litigation Action”)."

[starrynight]

There is some comfort from the following points listed in the prospectus:

a. the sale and purchase agreement in relation to the sale of the shares of BVI SPV to RREEF CCT contained a clear statement that the vendor of the shares of BVI SPV, being Tin Lik, was obliged to settle all intercompany debts between Bestride and HK Gateway prior to the completion of the transfer, save for an external loan of US$235 million then outstanding and
payable by HK Gateway to a bank (which does not cover the alleged loan of RMB210 million from Bestride to HK Gateway);

b. there is also no evidence of any loan given by Bestride to HK Gateway in the audited accounts prepared by HK Gateway’s auditors;

c. the vendor of Gateway Plaza (being MIC) has in the Beijing Gateway Share Purchase Agreement provided MGCCT with an indemnity against any losses that may be suffered by MGCCT as a result of the Litigation Action and in relation to the Beijing Representative Office, subject to MIC’s liability under the Beijing Gateway Share Purchase Agreement being limited to 10% of the Beijing Gateway Consideration (as defined herein).

Thanks for the links.
Investment moats website - I like that guy and I follow his blog closely as part of my learning process of stocks.
The other one is new to me but I will read in detail.

Prospectus Link: H E R E

Their page 53 is page 69 out of 700 pages in my pdf version.
Hope you can locate it.

I copied and paste here for you.

"There is a pending appeal in relation to HK Gateway Plaza Company Limited which owns Gateway Plaza that may adversely affect the value of the Units.

There is a pending appeal before the Supreme People’s Court of China (“

Pending Appeal”) in relation to a claim for the return of an alleged loan of RMB210.0 million (that purportedly took place in June 2007), filed by Beijing Bestride Real Estate Development Co Ltd (“Bestride”) against HK Gateway Plaza Company Limited (“HK Gateway”) which owns Gateway Plaza (the “Litigation Action”)."

[buttercarp]

Broker sms say private placement for mapletree was 38X over subscribed !
Wow looks like got lots of folks with lots of cash.

[hopeful]

was looking at Tradehaven's post
http://tradehaven.me/2013/02/21/bond...at-crossroads/

Olam perpetual's yield is 11.28%. so payback is 8.8years ?
Olam bond that matures in 25-oct-22 is 7.18%. so payback is 13.9years?

so from a risk point of view, if Olam would to go bankrupt/default in the next 5 years, wouldnt perpertual be a better bet since i get back 11.28 * 5 = 56.4% of my capital back versus 7.18*5% = 35.9% back ?

sorry if i sound stupid to the experts' here.

[cbsh38584]

It seem like the straight bond has moved a little higher after the initial minor correction 2 weeks ago. Juts FYI only. Below Bond availability is arranged by yield:

SGD Senior Corporate bonds
Issuer Cpn Maturity Moody's S&P Offer Oyield
ISIN


SGD SINGAPORE AIRLINES 2.150 30/9/2015 NA NA
103.20 0.89 SG3248962544


SGD OVERSEAS UNION ENTER LTD 3.360 27/9/2013 NA
NA 101.30 1.09 SG7X90962805


SGD CITY DEVELOPMENTS LTD 3.220 8/4/2015 NA NA
103.50 1.52 SG7V70955938


SGD VTB BANK (VTB CAPITAL SA 3.400 6/6/2014 Baa1
BBB 102.13 1.69 XS0633557391


SGD WHEELOCK MTN PTE LTD 3.500 15/12/2014 NA NA
102.99 1.80 SG6S54977607


SGD SWIBER HOLDINGS LTD 5.800 6/8/2013 NA NA
101.70 1.83 SG6W02984238


SGD OVERSEAS UNION ENTER LTD 4.300 15/4/2014 NA
NA 102.30 2.21 SG6O60969550


SGD BANYAN TREE HOLDINGS LTD 6.250 27/8/2013 NA
NA 101.50 3.14 SG7X35961425


SGD MACQUARIE BANK LTD 3.300 8/4/2016 A2 A
103.25 2.21 XS0615152591


SGD WING TAI HOLDINGS 3.300 26/5/2015 NA NA
102.18 2.29 SG7W43958232


SGD CITY DEVELOPMENTS LTD 2.780 21/9/2018 NA NA
100.30 2.72 SG6W51985383


SGD CAPITALAND TREASURY LTD 3.500 17/7/2017 NA NA
103.59 2.63 SG7D25926168


SGD SINGAPORE AIRLINES 3.220 9/7/2020 NA NA
102.50 2.84 SG7W61959351


SGD IDBI BANK LTD/DIFC DUBAI 3.650 28/8/2015 NA
BBB- 101.96 2.83 XS0821078275


SGD WING TAI HOLDINGS 3.380 27/7/2016 NA NA
101.74 2.84 SG6Q17972614


SGD KEPPEL CORP LTD 3.100 12/10/2020 NA NA 101.25
2.92 SG7X87962719


SGD FCT MTN PTE LTD 3.000 21/1/2020 NA NA 100.40
2.94 SG6Y79989324


SGD CITY DEVELOPMENTS LTD 3.380 20/3/2019 NA NA
102.99 2.84 SG6T63979668


SGD MAPLETREE INDUSTRIAL TRU 3.750 8/3/2019 NA
NA 104.89 2.86 SG6T36979555


SGD VTB BANK (VTB CAPITAL SA 4.000 20/7/2015 Baa1
BBB 102.50 2.91 XS0807340699


SGD OVERSEAS UNION ENTER LTD 3.950 29/9/2015 NA
NA 102.25 3.04 SG6Q78974608


SGD HOTEL PROPERTIES LTD 3.880 1/3/2016 NA NA
102.25 3.09 SG7Z66968016


SGD CATHAY PAC MTN FINANCING 3.250 20/1/2017 NA
NA 100.87 3.01 XS0735308909


SGD MORGAN STANLEY 4.000 23/10/2017 Baa1 A- 103.75
3.13 XS0326742912


SGD STARHUB LTD 3.080 12/9/2022 NA NA 99.50
3.14 SG6W34985252


SGD BANYAN TREE HOLDINGS LTD 5.500 14/3/2014 NA
NA 102.60 2.93 SG7Z75968189


SGD KEPPEL CORP LTD 3.145 14/2/2022 NA NA 100.25
3.11 SG6T03978952


SGD CAPITALAND TREASURY LTD 4.350 31/10/2019 NA NA
105.50 3.42 SG7P31938278


SGD LEND LEASE FIN INTL LTD 4.625 24/7/2017 Baa3 BBB-
105.63 3.24 XS0808748981


SGD LMIRT CAPITAL PTE LTD 4.880 6/7/2015 NA NA
103.45 3.34 SG6V57983292


SGD GUTHRIE GTS LIMITED 3.700 23/1/2018 NA NA
101.70 3.32 SG6Y88989414



SGD GREAT EASTERN LIFE ASSUR 4.600 19/1/2026 NA
A+ 108.40 3.38 SG7Z25966556


SGD WILMAR INTERNATIONAL LTD 3.500 25/1/2017 NA
NA 100.20 3.44 SG6S74978585


SGD HOTEL PROPERTIES LTD 3.930 10/6/2017 NA NA
102.10 3.40 SG6P69971275


SGD CAPITAMALLS ASIA TREASUR 3.700 29/8/2022 NA
NA 101.50 3.51 SG6W21984961


SGD GLL IHT PTE LTD 4.875 11/3/2016 NA NA 103.60
3.61 SG7Z69968062


SGD ICICI BANK LTD/DUBAI 3.650 14/1/2020 NA NA
100.25 3.61 XS0875313099


SGD OVERSEAS UNION ENTER LTD 4.950 1/2/2017 NA
NA 104.70 3.65 SG6S80978645


SGD NEPTUNE ORIENT LINES LTD 4.250 26/4/2017 NA
NA 102.50 3.60 SG6U79981465


SGD HOTEL PROPERTIES LTD 3.950 13/9/2019 NA NA
100.35 3.89 SG6W35985293


SGD HYFLUX LTD 4.250 7/9/2018 NA NA 101.40
3.91 SG6Q70974010


SGD WHEELOCK FINANCE LTD 4.500 2/9/2021 NA NA
103.75 3.98 XS0671301033


SGD FCL TREASURY PTE LTD 3.800 28/6/2022 NA NA
98.26 4.03 SG6V46982819


SGD OVERSEAS UNION ENTER LTD 4.250 30/10/2019 NA
NA 101.40 4.01 SG6X22986691


SGD HYFLUX LTD 4.200 29/8/2019 NA NA 100.80
4.06 SG6W23985057


SGD WILMAR INTERNATIONAL LTD 4.100 25/1/2019 NA
NA 100.20 4.06 SG6S75978592


SGD ASPIAL CORP LTD 5.000 27/7/2015 NA NA 102.22
4.02 SG6V85983744


SGD KEPPEL CORP LTD 4.000 7/9/2042 NA NA 97.50
4.15 SG6W26985096


SGD INDIAN OIL CORP LTD 4.100 15/10/2022 NA NA
99.60 4.15 XS0841678278


SGD NEPTUNE ORIENT LINES LTD 4.400 8/11/2019 NA
NA 101.00 4.23 SG6Y06987482


SGD NEPTUNE ORIENT LINES LTD 4.400 8/11/2019 NA
NA 101.00 4.23 SG6Y06987482


SGD BIOSENSORS INVESTMENTS 4.875 23/1/2017 NA NA
102.00 4.31 BBG003TPT9R6


SGD NEPTUNE ORIENT LINES LTD 4.650 9/9/2020 NA
NA 101.20 4.40 SG7X44961531


SGD HONG FOK CORP LIMITED 4.750 24/1/2018 NA NA
101.25 4.46 SG6Y93989433


SGD EZRA HOLDINGS LTD 5.000 7/9/2015 NA NA
100.50 4.79 SG6W28985177


SGD SWIBER HOLDINGS LTD 5.900 25/7/2014 NA NA
101.50 4.78 SG7Z28966603


SGD SHUI ON DEVELOPMENT SING 8.000 26/1/2015 NA
NA 105.00 5.21 SG6S73978214


SGD RAFFLES EDUCATION CORP 5.800 22/2/2016 NA NA
100.40 5.65 SG6Z45990066


SGD OLAM INTERNATIONAL LTD 5.800 17/7/2019 NA NA
94.50 6.88 SG6V64983574


SGD CENTRAL CHINA REAL ESTAT 10.750 18/4/2016 NA
B+ 111.00 6.79 XS0771842878


SGD OLAM INTERNATIONAL LTD 6.000 10/8/2018 NA NA
96.45 6.79 SG6Q54973046


SGD OLAM INTERNATIONAL LTD 6.000 25/10/2022 NA NA
93.00 7.01 SG6X10986208

[teddybear]

Perpetual can stop dividend payment anytime they want, so no guarantee that you will get the dividend. That is why I say, avoid perpetual, don't be fooled by them!

was looking at Tradehaven's post
http://tradehaven.me/2013/02/21/bond...at-crossroads/

Olam perpetual's yield is 11.28%. so payback is 8.8years ?
Olam bond that matures in 25-oct-22 is 7.18%. so payback is 13.9years?

so from a risk point of view, if Olam would to go bankrupt/default in the next 5 years, wouldnt perpertual be a better bet since i get back 11.28 * 5 = 56.4% of my capital back versus 7.18*5% = 35.9% back ?

sorry if i sound stupid to the experts' here.

[starrynight]

Broker sms say private placement for mapletree was 38X over subscribed !
Wow looks like got lots of folks with lots of cash.

My friend applied 400 lots and got allocated 1 lot. Not kidding

[starrynight]

Perpetual can stop dividend payment anytime they want, so no guarantee that you will get the dividend. That is why I say, avoid perpetual, don't be fooled by them!

Personally for peeps I think it is even more impt to see if there is a step-up after year x.

[starrynight]

Need some advise:

Olam 2.5% bond maturing 6 Sept 2013 is trading at around par. Given the half-yearly coupon payments, doesn't that mean that effectively one is earning 2.5% in slightly more than 6 months (as the 6 March half-yearly coupon payment is not made yet), i.e. yield is essentially just under 5%?

If so, sounds like a good investment? No risk associated with long-dated bonds, and not likely Olam will default in this sort of time horizon.

Am I missing something?

Thanks

[teddybear]

Given the short time span and under 5%, probably few want to take the risk? As we know, Olam is high risk investment

Need some advise:

Olam 2.5% bond maturing 6 Sept 2013 is trading at around par. Given the half-yearly coupon payments, doesn't that mean that effectively one is earning 2.5% in slightly more than 6 months (as the 6 March half-yearly coupon payment is not made yet), i.e. yield is essentially just under 5%?

If so, sounds like a good investment? No risk associated with long-dated bonds, and not likely Olam will default in this sort of time horizon.

Am I missing something?

Thanks

[starrynight]

Thanks for the comment.

Actually, in my personal situation, the short time span works just fine, and 4.8% effective yield (nett of buying comm) is sufficiently attractive (for me).

Given the short time span and under 5%, probably few want to take the risk? As we know, Olam is high risk investment

[teddybear]

Looking at Olam, I will not even bother even if they give me 10% within 6 months...

Thanks for the comment.

Actually, in my personal situation, the short time span works just fine, and 4.8% effective yield (nett of buying comm) is sufficiently attractive (for me).

[starrynight]

hahaha...

It's just my own conspiracy theory, but I think if the sh!t really hits the fan, Temasek and the founding family will / may join forces and privatise the company to minimise the embarassment

Looking at Olam, I will not even bother even if they give me 10% within 6 months...

[teddybear]

Well, it depends on the damage. It may not make sense if it happens like Enron right? (Not that I am saying Olam is like Enron, but we always must be aware of the risks ...)

hahaha...

It's just my own conspiracy theory, but I think if the sh!t really hits the fan, Temasek and the founding family will / may join forces and privatise the company to minimise the embarassment

[starrynight]

Agree with you, but (i) pride and (ii) covering up are possible strong motivations too

Well, it depends on the damage. It may not make sense if it happens like Enron right? (Not that I am saying Olam is like Enron, but we always must be aware of the risks ...)

[buttercarp]

My friend applied 400 lots and got allocated 1 lot. Not kidding

What a letdown for your friend!
I guess a lot of people hope to sell it on the first day.
What if the cornerstone investors all sell on first day .

Hubby tried to apply thru ATM today during lunch time but cannot get thru.
Perhaps lots of people were trying at the same time.

[teddybear]

Well, if you they have management control, then no choice have to raise it from ashes. But they own only 20% or so, there is no need. Just like they write off CITIC, a few hundred Millions $ (precedent!). So, my view is they will not bail out Olam if it happens (just like CITIC).

Agree with you, but (i) pride and (ii) covering up are possible strong motivations too

[starrynight]

That's why it's important to know the cornerstone investors - some of them manage pension funds, etc. and are therefore likely to be in it for the long term to earn yield to meet defined outcome pensions liabilities, etc.

In this instance, I would not be so concerned.

What a letdown for your friend!
I guess a lot of people hope to sell it on the first day.
What if the cornerstone investors all sell on first day .

Hubby tried to apply thru ATM today during lunch time but cannot get thru.
Perhaps lots of people were trying at the same time.

[starrynight]

Thanks.

Anyway, I found out the answer already - got a letter today saying that book closure date for the 6 Mar payment was 27 Feb, so that explains it Was a bit too good to be true after all

Well, if you they have management control, then no choice have to raise it from ashes. But they own only 20% or so, there is no need. Just like they write off CITIC, a few hundred Millions $ (precedent!). So, my view is they will not bail out Olam if it happens (just like CITIC).

[hopeful]

regarding property, some mention yield is based on purchase price while others mentioned that yield should be based on current price.

regarding olam perpetual bond again, with yield at 11% on 21 feb. even if no stepup clause, i would be claiming 11% for the rest of my life based on my purchase isn't it?

so even if rates go up to 3%, and Olam new bond offering 10year maturity 8% yield/coupon, I would be better off buying the perpetual with 11% yield?

I am comparing Olam bonds only with differing maturity dates.

[cbsh38584]

I bought SG$250k Petra Food straight bond 5% coupon at 100 par on 20th Apr12. Maturity date is 2017. LTV given is 70%. So come out cash 30% of SG$250k = SG$75k. Borrowing interest for $175k @ 1.35% including custodian fee..

Rec'd the 1st payout on of Sg$6250 on 20th Oct12.
Expect to rec the next payout of SG$6250 on 20th Apr13


Just rec'd a early redemption letter from Petra food . A 3% (103) incentive will be given to bond investors holders who agree to the early redemption of the bond. It will take est 6-7 mths (Oct 13) to complete the buyout from the bond investors.

Likely profit from Petra food bond for holding for 18 mths est $6250X3+ $7500 (3% of 250k ) = SG$26,250k.

Net return for holding 18 mths =$26.25k - $3.6(borrowing cost) = S$22.65k

==============================================
With the latest cooling measure nos 7 + increase in property tax. Buying straight bond with no leverage can be a alternative for those low risk investors.Just need to be patience for the yield to be attractive level to buy. Currently still hv S$3m bond. Need to slowly de-leverage.


rdgs,
Vic

[roly8]

is there a site that showcase latest bonds lobang and news?


straight bond is safer than perpetual bond ,right?

[cbsh38584]

is there a site that showcase latest bonds lobang and news?


straight bond is safer than perpetual bond ,right?

http://tradehaven.me/2013/01/26/bond...kies-paradise/


Straight bond is safer. But if Quality type of name like Cheung Kong SGD Perp 5.25% bond drop to <93. Can look into it. No leveraging for low risk bond investor.

rdgs,
Vic

[minority]

I bought SG$250k Petra Food straight bond 5% coupon at 100 par on 20th Apr12. Maturity date is 2017. LTV given is 70%. So come out cash 30% of SG$250k = SG$75k. Borrowing interest for $175k @ 1.35% including custodian fee..

Rec'd the 1st payout on of Sg$6250 on 20th Oct12.
Expect to rec the next payout of SG$6250 on 20th Apr13


Just rec'd a early redemption letter from Petra food . A 3% (103) incentive will be given to bond investors holders who agree to the early redemption of the bond. It will take est 6-7 mths (Oct 13) to complete the buyout from the bond investors.

Likely profit from Petra food bond for holding for 18 mths est $6250X3+ $7500 (3% of 250k ) = SG$26,250k.

Net return for holding 18 mths =$26.25k - $3.6(borrowing cost) = S$22.65k

==============================================
With the latest cooling measure nos 7 + increase in property tax. Buying straight bond with no leverage can be a alternative for those low risk investors.Just need to be patience for the yield to be attractive level to buy. Currently still hv S$3m bond. Need to slowly de-leverage.


rdgs,
Vic

can I ask how to buy bonds with leverage? financed through which banks?

[roly8]

http://tradehaven.me/2013/01/26/bond...kies-paradise/


Straight bond is safer. But if Quality type of name like Cheung Kong SGD Perp 5.25% bond drop to <93. Can look into it. No leveraging for low risk bond investor.

rdgs,
Vic

thanks alot for the link & advice.