BOND THREAD

[newbiebondinvestor]

Used to be a good idea to leverage on HDB bonds.. heard some banks offer 90% leverage.. now with hdb gaining AAA rating.. yields will drop. I remembered last year there was a 15y bond at close to 4%pa

[Amber Woods]

So what is the risk if CPF OA fully covers the monthly mortgage?

Then he is not likely to be over leveraged as long as he keeps his job.

[newbie11]

Dci on aud sgd is not bad. Citibank Dci allow strike and knock out price. 2 tier. Less risky. 4 to 5%

[Kelonguni]

Then he is not likely to be over leveraged as long as he keeps his job.

Then if a couple who has paid off their first mortgage opts to buy another one that max out their CPF, are they overleveraging?

Should they factor in rental from first property when they estimate what they can buy?

[cbsh38584]

Used to be a good idea to leverage on HDB bonds.. heard some banks offer 90% leverage.. now with hdb gaining AAA rating.. yields will drop. I remembered last year there was a 15y bond at close to 4%pa

.

My banker did not inform about the 3.98% HDB bond (LTV 85%)15 yrs tenor during the pre IPO. The reason is that they don't
get commission. I came to know from other source. He told me the coupon is low 3.98% for 15 year tenor. Anyway,
I did apply for S$1m but was not allocated. I should have bought on the 1st day of trading @101+ but find the bond
price abit high. One year later, it was trading at 107/109. Just week ago, Moody gives HDB AAA rating. I think the
price may have gone up >109.

Last year (2014) , I did apply S$250k for 3.008% HDB bond 7 yrs tenor during IPO. Surprisingly, I got the allocation. Six
month later, I sold off at around 3k+ profit. Will look buy again if the price correct to a attractive level for a AAA rated bond.
Can sleep very well at nite.

[Amber Woods]

Then if a couple who has paid off their first mortgage opts to buy another one that max out their CPF, are they overleveraging?

Should they factor in rental from first property when they estimate what they can buy?

Lets' not discuss this subject in this thread which is solely for bonds.

Anyway, there are plenty of discussions in this form on this subject. As long as you could sleep well despite all the debts; you are fine.

[cbsh38584]

Quality Bonds investment is quite conservative, mainly for you to beat inflation, unless you buy high yield bonds or highly leverage. But bear in mind many punches also lost to one knock out. Questions to sell or not depends on : 1) do you believe interest rate will hike soon . 2) can you find a better investment better than your current yield. I sold my olam bond half year ago and thinking interest rate hike in sep. I lost 5 mths yield while waiting. To me the best investment is still in property but of course without those CMs

I bought OLAM SGD 7% perp bond & USD 5.7% straight bond because of Temasek (before the muddy water attack) in 2012.
When muddy water report fault OLAM accounting. OLAM SGD 7% perp dropped from 98 to 72 & the USD 5.75% bond dropped
from 100 to 80. I was very stress but decide to ride through the crisis as I believe in Temasek.

Luckily, Temasek decides to increase their stake & now own 58%. I sold my USD 5.7% bond @102.5. Now trading@104.
I decide to keep the SGD 7% perp bond. May keep it till the callable date in 2019. Now trading@102.

I am looking at NOL bond which Temasek which huge stake in it. NOL is not doing well & just report millions of $$$ losses.
A potential takeover. If NOL will to default in it bond . I cant imagine what will happen to other Temasek big stake in capland ,
SIA , OLAM etc , the SGD investment grade & junk bond & eventually S'pore AAA rating reputation.

[Citizen]

I bought OLAM SGD 7% perp bond & USD 5.7% straight bond because of Temasek (before the muddy water attack) in 2012.
When muddy water report fault OLAM accounting. OLAM SGD 7% perp dropped from 98 to 72 & the USD 5.75% bond dropped
from 100 to 80. I was very stress but decide to ride through the crisis as I believe in Temasek.

Luckily, Temasek decides to increase their stake & now own 58%. I sold my USD 5.7% bond @102.5. Now trading@104.
I decide to keep the SGD 7% perp bond. May keep it till the callable date in 2019. Now trading@102.

I am looking at NOL bond which Temasek which huge stake in it. NOL is not doing well & just report millions of $$$ losses.
A potential takeover. If NOL will to default in it bond . I cant imagine what will happen to other Temasek big stake in capland ,
SIA , OLAM etc , the SGD investment grade & junk bond & eventually S'pore AAA rating reputation.

NOL bonds price dropped because Temasek looking to sell its stake. If another big corp or invester took over, the bonds rating will down grade. I bought NOL recently @94.5 and still holding it.

[Citizen]

1 gentle opinion . Invest with cautious, big boy can withstand a small blow or they exit quicker than us.

[cbsh38584]

NOL bonds price dropped because Temasek looking to sell its stake. If another big corp or invester took over, the bonds rating will down grade. I bought NOL recently @94.5 and still holding it.

Neptune Orient Lines Ltd 4.25% due 26/04/2017
price @102.00 in May'15. OCBC fixed income research team recommend over weight on NOL 4.25%.
Price drop to 100.2 in Aug15. OCBC fixed income research team still recommend over weight on NOL 4.25%
I do not know the price now. So need to find out more on the NOL 2017 bond outlook if it is being taken over
by potential investors.

Temasek sold loss making Stat chip to Chinese investors. The bond 4.5% due 2018 is still trading at around par.
It is recommended by CS & OCBC. It is one of the top holding at Fullerton Asian bond fund. I think NOL bond is also
one of fullerton bond portfolio if I can recall.

[Citizen]

Neptune Orient Lines Ltd 4.25% due 26/04/2017
price @102.00 in May'15. OCBC fixed income research team recommend over weight on NOL 4.25%.
Price drop to 100.2 in Aug15. OCBC fixed income research team still recommend over weight on NOL 4.25%
I do not know the price now. So need to find out more on the NOL 2017 bond outlook if it is being taken over
by potential investors.

Temasek sold loss making Stat chip to Chinese investors. The bond 4.5% due 2018 is still trading at around par.
It is recommended by CS & OCBC. It is one of the top holding at Fullerton Asian bond fund. I think NOL bond is also
one of fullerton bond portfolio if I can recall.

NOL @ 4.65% 2020 still hovering around 96 last Friday.

[cbsh38584]

NOL @ 4.65% 2020 still hovering around 96 last Friday.

The NOL 4.65% bond (LTV 55) price was 95+ in Sept15. Callable date is 9/9/2016. Likely
not to be called if FED raise rate in 2016.

NOL 4.25% bond due 2017 price should be around 100. Still got 1.5 yrs left. I go for
short dated bond if the price is attractive (under 100).

[Citizen]

The NOL 4.65% bond (LTV 55) price was 95+ in Sept15. Callable date is 9/9/2016. Likely
not to be called if FED raise rate in 2016.

NOL 4.25% bond due 2017 price should be around 100. Still got 1.5 yrs left. I go for
short dated bond if the price is attractive (under 100).

3rd week of Aug was quite bad for some bond prices. Remembered my RM kept calling me to buy.

[cbsh38584]

3rd week of Aug was quite bad for some bond prices. Remembered my RM kept calling me to buy.

Your RM is right that Aug15 mth was a sell down for emerging bond especially from China.

I bought RMB$1m China developer, Evergranda CNY 9.25% due Jan 16 @97.7 at Xrate 6.4080 in Aug15.
Now price is @100.25 & Xrate is 6.32.


FYI, Evergrande USD 12% bond due 2020 price was 98 in Aug15. I have been eyeing this bond for many
months. Keep asking my own RM & other RM through friends. All they say is AVOID. Too highly leverage.
But I am only interested in trading this 12% USD bond due to it HY (12%). But eventually I go for Evergande
CNY 9.25%. Today , the price for the evergrande 12% USD bond is @109 (Aug was 98). Easily US$20k profit
within 3 mths.

[newbiebondinvestor]

Theres some things which i dont quite understand.. i know banks offer LTV based on the credit rating of bonds. From what i see, there are some bonds which are not rated but yet are offered a higher LTV than rated bonds eg NOL and some junk bonds like swiber. Anyone know how do they determine this?

[cbsh38584]

Theres some things which i dont quite understand.. i know banks offer LTV based on the credit rating of bonds. From what i see, there are some bonds which are not rated but yet are offered a higher LTV than rated bonds eg NOL and some junk bonds like swiber. Anyone know how do they determine this?

You are right that some Junk bond offer higher LTV. Eg Junk bond Trikomsel 5.25% LTV is 65%. Now Trikomsel has defaulted.
Lippomall LTV55%-65% in foreign banks. Local banks ZERO. Many Chinese developer LTV is between 50% to 65% for foreign
banks. Most local banks is ZERO. From what I know, the foreign banks like to give higher LTV in order to "encourage" PB investors
to leverage. My banker told me the past 2 mths + is really bad for their biz. Less PB investors dares to trade after China devalue
the RMB in Aug15. He says if the trading activity continue to be poor, sooner or later the foreign banks will have to cut cost & eventually
will be asked to leave.

[Citizen]

You are right that some Junk bond offer higher LTV. Eg Junk bond Trikomsel 5.25% LTV is 65%. Now Trikomsel has defaulted.
Lippomall LTV55%-65% in foreign banks. Local banks ZERO. Many Chinese developer LTV is between 50% to 65% for foreign
banks. Most local banks is ZERO. From what I know, the foreign banks like to give higher LTV in order to "encourage" PB investors
to leverage. My banker told me the past 2 mths + is really bad for their biz. Less PB investors dares to trade after China devalue
the RMB in Aug15. He says if the trading activity continue to be poor, sooner or later the foreign banks will have to cut cost & eventually
will be asked to leave.

The bank give me ratio 1:5, some investments recommended by RM, some I chosen by myself. But all my investments are hold by the bank. Never mentioned about LTV. Definitely not local bank.

[newbiebondinvestor]

The bank give me ratio 1:5, some investments recommended by RM, some I chosen by myself. But all my investments are hold by the bank. Never mentioned about LTV. Definitely not local bank.

I guess it also depends on which tier of PB you are in? I am at the most basic tier and the range i am offered (foreign banks) is very limited. Some RMs are also giving very bad advice... asking me to buy bonds trading above par and then saying that with leverage i get a better yield. I recently just closed off one of my PB platform becoz the spread they take is huge.

[cbsh38584]

The SGD borrowing rate has just moved up from 2.16% to 2.6%. No more SGD bond for me as it is too expensive to
borrow. Also the risk is much higher for Junk bond in a rising rate environment going into 2016.

For the last 4 mths +, I have been doing DCI (dual currency investment) or Finer (another name of DCI) pairing
SGD (base) against Aus striking range between 0.99-0.975 yield 4%-6%.
SGD Vs USD @1.37 yield 4%
EURO VS [email protected] yield 5%.
EURO VS USD @1.15 yield 6%

I am looking at SGD (base) vs GBP strike @2.12 (bullish on pound). In 2003, GBP Xrate was 2.62. In 2007 , it was 3.02.

This coming Fri is the release of the important US jobs data & unemployment rate 5.1% - higher or low ?
It is bad, good for emerging mkt stock & bond as the Dec rate hike will likely to move next Mar16.

[Citizen]

Anyone know about the Julius Baer bond IPO around 5 % perpetuate ?

[Laguna]

The SGD borrowing rate has just moved up from 2.16% to 2.6%. No more SGD bond for me as it is too expensive to
borrow. Also the risk is much higher for Junk bond in a rising rate environment going into 2016.

For the last 4 mths +, I have been doing DCI (dual currency investment)

I'm surprised the pricing for S$ at 2.6% as I'm getting 1.6%

I'm now borrowing in Yen at 0.6% and Euro at 0.9%.
Euro is moving toward parity to USD.

I'm also DCI, but still need strong heart to read all the numbers especially when not in your favour...

[propertycarrots]

No sure if any investors here have been exposed to BitCoin currency. The recent surge has been insane: https://www.coinbase.com/charts
To those who recently bought at ~$200, it has surged to almost $493 in the last 3 days

http://www.bloomberg.com/news/articl...-gigantic-tear

[cbsh38584]

I'm surprised the pricing for S$ at 2.6% as I'm getting 1.6%

I'm now borrowing in Yen at 0.6% and Euro at 0.9%.
Euro is moving toward parity to USD.

I'm also DCI, but still need strong heart to read all the numbers especially when not in your favour...

No more buying SGD bond on leveraging. More toward USD/EURO bond. But come to 2016, I will be much careful in
buying bond. I cant believe the Chinese developer & Russian bank/Oil/gas bond moved up between 3-5% since Aug15.

.

[Arcachon]

No sure if any investors here have been exposed to BitCoin currency. The recent surge has been insane: https://www.coinbase.com/charts
To those who recently bought at ~$200, it has surged to almost $493 in the last 3 days

http://www.bloomberg.com/news/articl...-gigantic-tear

Taiwanese Kidnappers Receive $1.68M Bitcoin Ransom from Billionaire Yuk-Kwan

https://www.google.fr/search?q=Kidna...sm=93&ie=UTF-8

Singapore News too slow.

[minority]

Kepple reits issued a 5% bond. Is it worth buying?

https://secure.fundsupermart.com/mai...e=SG31A5000006

[richwang]

SINGAPORE: The second issue of the Singapore Savings Bonds has closed, with only about 20 per cent allocated to investors. This is lower than the one-third allocation rate in the first issue.

Excluding applications that exceeded allotment limits of S$50,000 per bond issue or up to S$100,000 worth of total bonds, the Monetary Authority of Singapore (MAS) said S$257 million worth of bonds will be allocated. This is compared to the S$413 million in applications for the first tranche, also capped at S$1.2 billion. Both issues were capped at S$1.2 billion each.

Investors can apply for the Singapore Savings Bond through an ATM. However, an individual Central Depository, or CDP account is needed too, alongside an ATM card and a bank account. Financial advisors said the target group for the Singapore Savings Bond is less likely to have a CDP account.

A CDP account, commonly known as a trading account, can be opened in person at the Central Depository, or via mail. According to financial advisors, the target group for the bonds are retail investors, who are looking for a safe, long-term savings option.

These can be investors that are more risk-averse, or those with simply less spare cash to set aside for retirement planning.

SingCapital CEO Alfred Chia, said: "Based on our ground feel, many people are still unaware about the Singapore Savings Bond or have the CDP account, which is why I think there should be a lot more awareness.

“A lot of people probably are still not familiar with this. But those who are following all this news, who are more savvy, probably they are expecting the yield to be higher."

This group of investors - betting on global interest rates to go up - are most likely to have redeemed their bonds.

Data released by the MAS on Wednesday showed that bondholders applied to redeem S$9.3 million worth of bonds. This will be effected on Nov 2. The Savings Bonds will be issued every month for at least the next five years.

http://www.channelnewsasia.com/news/....html?cid=FBsg

December SAVING BOND rates have dropped to 2.44 - that is lower than CPF OA rate. Will they open SAVING BONDS for SRS soon?

http://www.sgs.gov.sg/savingsbonds/Y...nths-bond.aspx

[Citizen]

The NOL 4.65% bond (LTV 55) price was 95+ in Sept15. Callable date is 9/9/2016. Likely
not to be called if FED raise rate in 2016.

NOL 4.25% bond due 2017 price should be around 100. Still got 1.5 yrs left. I go for
short dated bond if the price is attractive (under 100).

In 6th nov news .CMA CGM, Maersk in Talks to Buy Singapore's Neptune Orient Lines. Dunno what is the implication on the bonds price.

[Citizen]

For the 2017 bonds (NOLSP 4.250% 26Apr2017 Corp (SGD)), the terms of the bonds include the option of an acquirer of NOL (under a change-of-control trigger) to call back the debt of the company; should the acquirer not do so, the 4.25% coupon will actually be stepped up by 150bps to 5.75%, which would provide the bondholder with an additional return over the bond.

[cbsh38584]

For the 2017 bonds (NOLSP 4.250% 26Apr2017 Corp (SGD)), the terms of the bonds include the option of an acquirer of NOL (under a change-of-control trigger) to call back the debt of the company; should the acquirer not do so, the 4.25% coupon will actually be stepped up by 150bps to 5.75%, which would provide the bondholder with an additional return over the bond.

I did ask my banker to Queue @100.5 for 2017. But No seller.
The 2017 bond will not default due to Temasek >60% stake.
Even if it is acquired. The 2017 Bond (with setup) is still safe.

[cbsh38584]

I bought Pacific International Lines (PIL), 5.9% SGD BOND due 17jul2017 @100 on Jul14.

Just last week, Pacific International Lines Sold 3-Year SGD 7.25% Bond due Nov'18.
I do not know why 3 bookrunners are needed for a small issued S$130m issue size.
The worst is that they are giving out a HIGH LTV 70% for this junk bond. I believe
they are giving high LTV 70% to entice investors to buy. Price to [email protected].

I am not so comfortable about this PIL companies if there is another lehman type crisis
comes again. I may sell away for PIL 5.9% bond due Jul17 at min loss.