Bonds redeemed at a premium.- higher returns.
May 14, 2018 21:43:59 GMT
elliotn and pmjenkins like this
Post by jaswells on May 14, 2018 21:43:59 GMT
What I particularly like about Wisealpha is that they are quite selective about the bonds they put on the platform and tend to present better options to their investors (if only all p2p was so selective). They are big fans of all bonds 'virgin' and i would tend to agree these are excellent investments.
The result of this is some bonds are redeemed above par resulting in a windfall, two recently:
(from wisealpha email)
Last week saw Tesco’s 4.875% bonds bought back by the global retail giant at a price of 112.737, a significant premium to the price of 100.5, when the bond was first offered on WiseAlpha nine months ago. A number of WiseAlpha’s who were on the ball correctly spotted that Tesco was embarking on a strategy of reducing it’s borrowings and buying back its bonds and reaped a nice 15% in cash returns over 9 months (interest plus capital gain). Not a bad return from the nation’s favorite food retailer.
Also worth mentioning was the return made by Matalan holders earlier in the year when the bonds were refinanced. WiseAlpha’s picked them up at a discounted price of 86.25 based on the view that company performance was improving following a recent profit hit and that a refinancing of the bonds was on the cards, given the fast approaching maturity date in 2019. Matalan prepaid the bonds early at a price of 101.71875 and together with interest the first WiseAlpha’s in made a cool 21.5% cash return (interest and capital gain) in the space of just 9 months.
Regards
The result of this is some bonds are redeemed above par resulting in a windfall, two recently:
(from wisealpha email)
Last week saw Tesco’s 4.875% bonds bought back by the global retail giant at a price of 112.737, a significant premium to the price of 100.5, when the bond was first offered on WiseAlpha nine months ago. A number of WiseAlpha’s who were on the ball correctly spotted that Tesco was embarking on a strategy of reducing it’s borrowings and buying back its bonds and reaped a nice 15% in cash returns over 9 months (interest plus capital gain). Not a bad return from the nation’s favorite food retailer.
Also worth mentioning was the return made by Matalan holders earlier in the year when the bonds were refinanced. WiseAlpha’s picked them up at a discounted price of 86.25 based on the view that company performance was improving following a recent profit hit and that a refinancing of the bonds was on the cards, given the fast approaching maturity date in 2019. Matalan prepaid the bonds early at a price of 101.71875 and together with interest the first WiseAlpha’s in made a cool 21.5% cash return (interest and capital gain) in the space of just 9 months.
Regards