Nzdx fees

[Beagle]

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...

[GTM 3442]

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.

I have some bonds. The strategy is to buy at time of issue and hold to maturity. For diversity.

The only time I buy on the secondary market is perpetuals, and that is driven by price.

I understand that TTK used to have a good dividend yield, and it's gotten even better now that the *rse has fallen out of the price.

[BIRMANBOY]

Hah.... TTK that would be because David kept having his *rse nibbled at. However David (and what remains of said *rse ) is no longer featuring so will be interesting to see where this travels. SP has been relatively stable for a while so some good news may drive this up fast...he said hopefully. Dividend is good ..long may it prosper.

I have some bonds. The strategy is to buy at time of issue and hold to maturity. For diversity.

The only time I buy on the secondary market is perpetuals, and that is driven by price.

I understand that TTK used to have a good dividend yield, and it's gotten even better now that the *rse has fallen out of the price.

[peat]

I have some bonds. The strategy is to buy at time of issue and hold to maturity. For diversity.

Yeh we have a lot of clients like this. They rarely sell on market, so never pay any brokerage themselves. It makes sense for sure. But recently some Issuers arent paying commission. To talk my book a little, cost of brokerage over a 5 year bond isnt much per annum compared to the funds that charge you 1% or more per annum to look after your long term bonds.

[GTM 3442]

Yeh we have a lot of clients like this. They rarely sell on market, so never pay any brokerage themselves. It makes sense for sure. But recently some Issuers arent paying commission. To talk my book a little, cost of brokerage over a 5 year bond isnt much per annum compared to the funds that charge you 1% or more per annum to look after your long term bonds.

You book sounds an interesting read. I think I might be interested in buying a copy.

How'd you like to PM me with the details of where I can find it. . .

[BIRMANBOY]

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.

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...

[Beagle]

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.

SIGH - You might want to check the thread topic its NZDX fees...nothing whatsoever to do with asset allocation strategies. In case you don't know brokers charge circa 0.5% for secondary market sales and purchases of NZDX securities despite it being a fully computerised and listed market whereas share transactions can be had for as low as 0.2%..suppose I should be charitable and suggest you might have overlooked the actual subject matter at 9.14 p.m. at night but while we're on the subject of fees, (not asset allocation), although you have quite rightly mentioned now is not a good time to buy its perhaps worth noting to illustrate the point I was making in my earlier post that if someone bought your AIR bonds off you at the current secondary market 4% yield they'd pay 0.5% brokerage on a bond that has a life to run of only 18 months so their net annual yield would only be 3.67%. As you suggest...not a good time to buy.