Any opinions on this welcome; my eyes glaze over too fast on the details.
Terms Sheet linked here
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Any opinions on this welcome; my eyes glaze over too fast on the details.
Terms Sheet linked here
The Vector one was ever so slighly better (almost identical terms)
But at 5.7% its good enough for bond investors to be tempted I would suggest. We filled our book and sold the lot.
While it is long dated, it has a reset and resale facility provided by the Issuer every five years. And yet this allows them to consider 50% of the debt as equity. So its a win win in my view. Its pretty unlikely you will be forced to rollover in 5 years (but possible) The Issuer has to pay an extra margin on the whole bond if there are some not resold in five years so they are incentivised to place redemptions with new bond investors .
Vector bond was better though because the extra margin was a whole one percent whereas the Genesis extra margin is only 0.25%
Other than that and GNE paying quarterly interest the two bonds were the same.
I heard its heavily oversubscribed?
yes indeed McDongle
I've been allocated 80% of what I applied for, so not too bad. Now waiting to see how much scaling there will be on Vector.
Excellent; many thanks peat:t_up:
Vector scaling was brutal.
Luckily I got 100% of my application.
It was only 10K though..............
Of Vector
i've just finished moving my allocation (for clarity, of Genesis)
I am broadening my Horizon away from the current P2P major platform that's providing very few retail loans in the last few weeks.
Have applied for heaps of GNE050 Bonds coming up soon, hope my broker doesn't scale me back too much.
This will compliment my TD's; one advantage being, that they can be cashed in quickly. I am waiting for the property bubble to POP, then search for buying opportunities.
Scaled back to a third of our Genesis app.
Genesis doing another issue $75m with rights to $50m oversubscriptions. 6 years, minimum interest rate 4.00%, standard brokerage charges apply to any bonds you are allocated, expressions of interest deadline is first thing tomorrow. Whenever I have seen this I have always found it objectionable that companies raising money from the public expect that those subscribing will pay the costs of the brokerage.
Also objectionable that for no valid reason brokerage on fixed interest securities is significantly higher than for equities.
Upshot of this is you are not really getting 4%, the real yield is closer to 3.9% after brokerage costs....or you can get about 8.5% gross yield plus future growth on the shares and pay a modest 0.2% brokerage to do so, which is what I did this morning instead.
After the 1.56% coupon for the Mercury Green Bonds the other year, I think there are a fair few who are seeing 4% as very attractive in the fixed interest space.
However, those Mercury Green Bonds are now crossing at 4%.
I expect a similar situation with the Genesis issue a couple of years down the track. I'd be looking at buying at about 6% (or about 90c in the dollar) for them in second half of 2024.
It's a funny old world. . .
Yes, there's a lot of issues in recent years where people would be looking at a significant capital loss if they sold now. OCA issued 7 year bonds at 2.30% a while back, now trading at 4.25% and anyone selling now is tearing up 10% of their capital.
I think the final rate set on these was 4.17% but I agree with you that the prospect of some capital loss even at that rate is very real which is another reason I choose the shares which I see as having the real prospect of capital appreciation along with earning more than twice the yield.