Agreed 100%. My point though is always when considering a bond issue, first ask yourself in the underlying equity is a better bet.
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If you had bought OCA shares instead of their bonds your capital would be down 23% on the Oct 20 bonds and 32% down on the Sep21 bonds ...collected a few divies in the process
Mind you capital value of these bonds are down as well ...the 2.3% bonds down 9% and the 3.3% ones down 5%
Lost heaps on shares .... lost a little on the bonds
But says any recent investment in Oceania has been bad, really bad - can't win either way ...shares or bonds have been duds .... reflects Oceania management
Maybe the depths of despair is the best to time to buy.
I can see we're coming from somewhat different directions here Beagle.
I'm buying to fit an asset allocation model, and return on capital is only one of the criteria.
There's also the effect on the average credit rating of the bond portfolio, maturity date for laddering, strength of the underlying company, all those sorts of things.
Example OCA - sold out of the shares , looking to buy the bonds - but only at the right price, or Infratil's IFTHA - that annual reset really makes a difference over the long haul on the right entry price.
I totally understand where you are coming from. Contrary to some of the talk (strangely on the OCA thread), about being all in on equities as "THE" only way to go in terms of maximizing long term returns I think there are times that having some bonds or short term deposits are a good strategy but as you quite rightly point out timing is very important.
https://www.directbroking.co.nz/Dire...spx?id=6018053
Terms of the new Mercury Bond issue 5.73%, not too bad for a bond. I put my hand up for a few and hope I get them.
GNE040 Bond may be repaid/rolled over next month (9/6/22). Be interesting to see what new offer they come up with if it is.
Chris Lee guessing around 5.5%.
GNE040 was 5.7%
If its around 5.5% I'll probably put my hand up for a few.
Yeah, I'll probably roll mine over to the new one.
It appears there is no option to roll over the current bond due to timing.
I think Genesis will have annoyed a few current investors by doing this (me included).
Will just have to hope for some bargains to be around after the 9th June to spend my money on.
Terms are out for the new Green bond issue for Genesis. Minimum rate 5.35%. They are unsecured and rank behind more than $2 Billion in more secured debt. Looking at the overall structure of the balance sheet I prefer the extra 3% gross yield on the shares and will put my hand up for more of those instead.
P.S. Might get a few of these bonds too.