Here we go again.....sigh..its all about when you buy more than what you buy. Eyes wide open and 360 degree vision will get you a lot further than tunnel vision. My bonds are ANZ perpetual 7.2%, Works Finance 10.45 %, IFT 7.87%. Air NZ 6.9%, IFT 8.35% I hold all these as well as div. stocks. Funny I don't feel ripped off at all and quite happy with the yields. Now is not a good time to buy unless of course interest rates keep dropping...in which case the current yields may turn out to be quite good in 4 or 5 years. As GTM said they have a role to play in a diversified portfolio.
Quote Originally Posted by Roger View Post
Agree 100% with the sentiment in this thread. Lets take the minimum brokerage on a $15,000 share transaction at ANZ securities as an example seeing as many on here use them. It's $29.90 including stock exchange trade fee.

So if one is buying $15,000 of a fixed interest security on the DX market and its done online just like a share purchase why on earth should it cost 15,000 x 0.5% + 5.50 trade fee = $80.50 for what is ostensibly exactly the same service processed in exactly the same way. This is blatant oligopolistic pricing by the brokers and adds insult to injury when interest rates on bonds are at record lows. Disc: Don't own any bonds as I strongly dislike being ripped off with grossly excessive brokerage and dividend yield on quality stocks are vastly higher than bonds.

Buy REIT's instead. GMT and ARG still 5% net and are PIE's so investors on a 33% tax rate are getting an effective gross return of 7.5%...can't see any quality company issuing bonds at 7.5% lately...