No. of Recommendations: 1

The bond is

(1) Not yet trading in retail quantities. (See link below.)
(2) Not yet available thru E*Trade, Schwab, Fidelity, or Zions Direct as of 5 minutes ago.
(3) Won’t offer a real rate of return to maturity even if the trade could be done at the ‘Last Price’ of 107.625 (assuming customary tax-rates on ord-inc and a 5% inflation-rate).
(4) The 2016 call is even more adverse (assuming the same assumptions as previously).

Once again and as always, 'nominal YTMs' are meaningless unless the investor is deliberating choosing to depreciate his/her purchasing-power. The only thing that matters by way of investment returns is spending power at the grocery store or gas pump. So, other than the fact that the bond can’t be found to buy, and that buying it would lose you money, this is a wonderful opportunity. ROTFL.

But you're to be commended for making the effort to call the community's attention to this bond. Practicing one's due-diligence is never a wasted effort. At a much, much lower price this might be a good opportunity. But the bond market hasn't got it wrong. Given the bubble we are still in, the bond is priced in line with its peers, and it should be of no interest to long-term, defensive investors. (IMHO, 'natch)

Print the post  


When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.