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OK, now that I’ve finished my scanning and buying for the morning, I can switch over to chatting about bonds. Today, let’s dig into GMAC’s bonds, and let’s run the same exercise as yesterday. (Investing is nothing if not practice, practice, practice, so that the right moves can be done when the opportunity to act presents itself.)

Depending on when during the market day you run your scan, the list returned to you will vary as lots are offered and sold. But, roughly, if you ask to see all of General Motor’s debt, you’ll get 200 hits or so, some of which will be more discounted --and, thus, potentially more attractive-- than their peers. 200 or so bonds isn’t a lot to look at, one by one. But it makes sense to automate the process. So let’s do that with a bubble sort (which is easy to create in Excel using an IF-ELSE rule).

Coupon Maturity YTM Best
6.000 12/15/11 0.32 0.32
6.000 12/15/11 0.32 0.32
7.000 02/01/12 1.75 1.75
7.000 02/01/12 1.75 1.75
2.387 02/15/12 0.00
2.583 02/15/12 0.00
2.787 02/15/12 0.00
2.662 03/15/12 0.00
6.625 05/15/12 1.83 1.83
6.625 05/15/12 2.78 2.78
7.125 08/15/12 2.88 2.88
7.250 08/15/12 3.59 3.59
6.875 08/28/12 5.15 5.15
6.875 08/28/12 5.15 5.15
6.750 09/15/12 6.92 6.92 <<==
7.000 10/15/12 4.63
7.150 11/15/12 3.32
7.000 12/15/12 2.68
7.250 12/15/12 2.92
7.000 01/15/13 2.05
6.650 02/15/13 3.01
6.800 02/15/13 5.41
6.250 03/15/13 5.95
6.400 03/15/13 5.66
6.500 03/15/13 6.22
6.750 04/15/13 2.28
6.350 05/15/13 2.75
5.850 05/15/13 2.05
6.000 07/15/13 1.08
6.375 08/01/13 5.63
6.150 09/15/13 3.28
6.250 10/15/13 1.79
6.250 11/15/13 2.44
6.200 11/15/13 6.41
6.000 11/15/13 5.53
5.900 12/15/13 6.74
5.700 12/15/13 6.79
7.500 12/31/13 6.94 6.94
6.700 05/15/14 6.50
6.750 12/01/14 7.26 7.26
2.511 12/01/14 0.00
6.750 12/01/14 7.26 7.26
4.403 12/01/14 0.00
6.500 02/15/16 8.29 8.29
6.500 02/15/16 8.37 8.37
6.350 02/15/16 8.37 8.37
6.500 03/15/16 8.48 8.48
6.400 03/15/16 8.37
6.150 03/15/16 6.65
6.200 03/15/16 8.37
6.300 03/15/16 8.17
6.350 04/15/16 8.37
6.850 04/15/16 8.37
6.650 04/15/16 8.37
6.850 04/15/16 8.37
6.850 05/15/16 8.17
7.000 05/15/16 8.37
7.500 05/15/16 8.17
10.500 05/15/16 5.89
7.500 06/15/16 8.37
6.750 07/15/16 8.37
6.750 07/15/16 8.17
7.000 07/15/16 8.17
6.850 07/15/16 8.17
6.700 08/15/16 8.17
6.600 08/15/16 8.38
6.875 08/15/16 8.37
7.000 08/15/16 8.37
7.000 08/15/16 8.17
6.650 08/15/16 8.17
6.750 08/15/16 8.37
6.750 08/15/16 8.17
6.500 09/15/16 8.77 8.77
6.750 09/15/16 8.17
6.800 09/15/16 8.37
6.500 09/15/16 8.17
6.500 10/15/16 8.37
6.550 10/15/16 8.17
6.350 10/15/16 8.17
6.500 10/15/16 8.17
7.500 11/15/16 8.18
7.375 11/15/16 8.18
6.750 11/15/16 8.18
7.000 11/15/16 8.37
7.000 12/15/16 8.18
7.350 01/15/17 8.28
7.000 02/15/17 8.28
6.750 06/15/17 8.84 8.84
7.000 06/15/17 8.28
6.900 06/15/17 8.68
6.950 06/15/17 8.68
7.000 07/15/17 8.69
7.500 08/15/17 8.68
7.250 09/15/17 8.68
7.250 09/15/17 8.78
7.250 09/15/17 8.82
7.250 09/15/17 8.78
7.200 10/15/17 9.05 9.05
7.125 10/15/17 8.68
7.200 10/15/17 8.68
7.750 10/15/17 8.28
8.125 11/15/17 8.28
8.000 11/15/17 8.28
7.500 11/15/17 8.28
7.500 11/15/17 8.28
7.400 12/15/17 9.17 9.17
7.300 12/15/17 8.28
7.500 12/15/17 9.00
7.500 12/15/17 8.28
7.300 01/15/18 8.83
7.300 01/15/18 9.03
7.250 01/15/18 8.78
7.000 02/15/18 8.83
7.000 02/15/18 8.83
7.000 02/15/18 8.83
6.750 03/15/18 9.39 9.39 <<==
7.000 03/15/18 8.85
7.050 03/15/18 8.89
7.050 03/15/18 8.38
7.375 04/15/18 8.83
7.250 04/15/18 9.00
7.250 04/15/18 8.85
7.350 04/15/18 8.83
7.050 04/15/18 8.89
7.000 05/15/18 8.83
6.850 05/15/18 8.88
6.600 05/15/18 8.83
6.650 06/15/18 8.99
6.700 06/15/18 8.96
6.700 06/15/18 9.07
6.500 06/15/18 8.38
6.900 07/15/18 8.83
6.750 07/15/18 8.94
6.875 07/15/18 8.38
7.000 08/15/18 8.83
7.250 08/15/18 8.89
6.900 08/15/18 8.38
7.250 08/15/18 8.78
7.250 09/15/18 8.86
7.150 09/15/18 8.38
7.000 09/15/18 9.11
6.800 09/15/18 8.99
6.750 09/15/18 8.83
6.650 10/15/18 8.93
6.750 10/15/18 8.83
6.650 10/15/18 8.83
6.800 10/15/18 8.83
6.750 11/15/18 8.38
6.700 11/15/18 9.15
6.500 11/15/18 8.83
6.500 12/15/18 8.84
6.500 12/15/18 8.83
6.400 12/15/18 8.83
6.250 12/15/18 8.83
6.250 01/15/19 8.83
5.900 01/15/19 8.73
5.900 02/15/19 8.48
6.000 02/15/19 8.48
6.000 02/15/19 8.77
6.000 02/15/19 8.81
6.000 03/15/19 8.48
6.000 03/15/19 8.48
6.000 03/15/19 8.73
6.000 03/15/19 8.74
6.000 03/15/19 8.73
6.000 04/15/19 8.76
6.350 04/15/19 8.73
6.200 04/15/19 8.83
6.250 04/15/19 8.73
6.500 05/15/19 8.93
6.750 05/15/19 8.73
6.750 05/15/19 8.93
6.750 06/15/19 8.93
6.600 06/15/19 8.93
6.700 06/15/19 8.93
6.750 06/15/19 8.93
6.600 06/15/19 9.02
6.350 07/15/19 8.48
6.350 07/15/19 8.83
6.250 07/15/19 8.98
6.300 08/15/19 8.83
6.300 08/15/19 8.82
6.050 08/15/19 8.48
6.150 08/15/19 8.73
6.050 08/15/19 8.73
6.100 09/15/19 8.73
6.150 09/15/19 8.48
6.000 09/15/19 8.73
6.000 09/15/19 8.73
5.900 10/15/19 8.68
6.150 10/15/19 8.48
6.050 10/15/19 8.48
6.125 10/15/19 8.48
6.400 11/15/19 8.66
6.400 11/15/19 8.73
6.550 12/15/19 8.48
6.550 12/15/19 8.48
6.700 12/15/19 8.93
6.500 01/15/20 8.58
6.650 02/15/20 8.93
6.500 02/15/20 8.58
6.750 03/15/20 9.00
9.000 07/15/20 8.34
9.000 07/15/20 8.28
8.750 08/15/20 7.85
8.250 08/15/20 6.98
7.000 09/15/21 8.93
7.000 09/15/21 8.93
7.000 06/15/22 8.74
7.000 11/15/23 8.59
7.000 11/15/24 9.08
7.000 11/15/24 8.83
7.000 11/15/24 8.59
7.250 01/15/25 8.95
7.150 01/15/25 8.59
7.250 02/15/25 8.59
7.250 03/15/25 8.59
7.150 03/15/25 8.59
7.500 03/15/25 9.11
8.000 03/15/25 8.49
8.000 11/01/31 8.49
8.000 11/01/31 8.62

Explanation: Columns One and Two are self-explanatory. Column Three is as E*Trade calculates YTM when a commish of $1/bond is included. Column Four is created by a bubble sort that identifies the mostest yield over the shortest time. (The same result can be achieved by eye. But it’s faster to do it by rule.) Of immediate interest is the 6.75’s of ’12, because 6.92% is a lot of yield for a holding-period of less than a year. A lot of ten was offered this morning (min 1), and it still might be available. But the hassle with that maturity --and any short maturity bond-- is the impact of commish. In order to achieve the projected 6.92%, all ten would have to be bought. If just a single were bought, then commish jumps to $10 bucks (at E*Trade), and YTM drops to sub-6%. So let’s look further out on the yield-curve.

The next bond of potential interest would be 6.75’s of ’18. Nothing of shorter maturity offers a greater yield. Nothing of longer maturity offers a greater yield. This isn’t to say that this bond should be bought. Maybe you already own gobs of GMAC. Maybe you don’t like messing with less than invest-grade bonds. There’s lot of reasons why this issuer’s debt should be avoided. But there’s also some reasons why taking a position wouldn’t be a bad thing to do. So let’s run the next step in the vetting process and attempt to estimate the impact of inflation on yield. For the sake of convenience (and reality), let’s use an inflation-rate of 5%, and let’s estimate our YTM on the price we’d have to pay for a single bond.

Coupon Maturity Adj_YTM Best
6.000 12/15/11 -10.5% -10.5%
6.000 12/15/11 -10.5% -10.5%
7.000 02/01/12 -6.2% -6.2%
7.000 02/01/12 -6.2% -6.2%
2.387 02/15/12 -4.9% -4.9%
2.583 02/15/12 -5.5%
2.787 02/15/12 -5.6%
2.662 03/15/12 -4.7% -4.7%
6.625 05/15/12 -4.5% -4.5%
6.625 05/15/12 -3.5% -3.5%
7.125 08/15/12 0.3% 0.3%
7.250 08/15/12 -0.1%
6.875 08/28/12 -0.8%
6.875 08/28/12 -0.8%
6.750 09/15/12 1.0% 1.0%
7.000 10/15/12 0.0%
7.150 11/15/12 -0.6%
7.000 12/15/12 0.7%
7.250 12/15/12 1.0%
7.000 01/15/13 0.4%
6.650 02/15/13 0.2%
6.800 02/15/13 0.9%
6.250 03/15/13 0.6%
6.400 03/15/13 0.6%
6.500 03/15/13 0.9%
6.750 04/15/13 -0.2%
6.350 05/15/13 0.1%
5.850 05/15/13 -1.0%
6.000 07/15/13 -0.1%
6.375 08/01/13 0.8%
6.150 09/15/13 0.1%
6.250 10/15/13 -0.2%
6.250 11/15/13 -0.2%
6.200 11/15/13 1.0% 1.0%
6.000 11/15/13 0.5%
5.900 12/15/13 1.4% 1.4%
5.700 12/15/13 1.4% 1.4%
7.500 12/31/13 1.6% 1.6%
6.700 05/15/14 1.4%
6.750 12/01/14 2.0% 2.0%
2.511 12/01/14 1.8%
6.750 12/01/14 2.0% 2.0%
4.403 12/01/14 3.8% 3.8%
6.500 02/15/16 3.0%
6.500 02/15/16 3.1%
6.350 02/15/16 3.1%
6.500 03/15/16 3.2%
6.400 03/15/16 3.1%
6.150 03/15/16 1.5%
6.200 03/15/16 3.1%
6.300 03/15/16 2.9%
6.350 04/15/16 3.1%
6.850 04/15/16 3.1%
6.650 04/15/16 3.1%
6.850 04/15/16 3.1%
6.850 05/15/16 2.9%
7.000 05/15/16 3.1%
7.500 05/15/16 3.0%
10.500 05/15/16 2.6%
7.500 06/15/16 3.1%
6.750 07/15/16 3.1%
6.750 07/15/16 2.9%
7.000 07/15/16 3.0%
6.850 07/15/16 3.0%
6.700 08/15/16 3.0%
6.600 08/15/16 3.2%
6.875 08/15/16 3.1%
7.000 08/15/16 3.1%
7.000 08/15/16 3.0%
6.650 08/15/16 2.9%
6.750 08/15/16 3.1%
6.750 08/15/16 3.0%
6.500 09/15/16 3.5%
6.750 09/15/16 3.0%
6.800 09/15/16 3.1%
6.500 09/15/16 2.9%
6.500 10/15/16 3.1%
6.550 10/15/16 2.9%
6.350 10/15/16 2.9%
6.500 10/15/16 2.9%
7.500 11/15/16 3.0%
7.375 11/15/16 3.0%
6.750 11/15/16 3.0%
7.000 11/15/16 3.1%
7.000 12/15/16 3.0%
7.350 01/15/17 3.1%
7.000 02/15/17 3.1%
6.750 06/15/17 3.6%
7.000 06/15/17 3.1%
6.900 06/15/17 3.4%
6.950 06/15/17 3.4%
7.000 07/15/17 3.5%
7.500 08/15/17 3.4%
7.250 09/15/17 3.5%
7.250 09/15/17 3.5%
7.250 09/15/17 3.6%
7.250 09/15/17 3.5%
7.200 10/15/17 3.8% 3.8%
7.125 10/15/17 3.5%
7.200 10/15/17 3.5%
7.750 10/15/17 3.1%
8.125 11/15/17 3.1%
8.000 11/15/17 3.1%
7.500 11/15/17 3.1%
7.500 11/15/17 3.1%
7.400 12/15/17 3.9% 3.9%
7.300 12/15/17 3.1%
7.500 12/15/17 3.8%
7.500 12/15/17 3.1%
7.300 01/15/18 3.6%
7.300 01/15/18 3.8%
7.250 01/15/18 3.5%
7.000 02/15/18 3.6%
7.000 02/15/18 3.6%
7.000 02/15/18 3.6%
6.750 03/15/18 4.1% 4.1% <<==
7.000 03/15/18 3.6%
7.050 03/15/18 3.7%
7.050 03/15/18 3.2%
7.375 04/15/18 3.6%
7.250 04/15/18 3.8%
7.250 04/15/18 3.6%
7.350 04/15/18 3.6%
7.050 04/15/18 3.6%
7.000 05/15/18 3.6%
6.850 05/15/18 3.6%
6.600 05/15/18 3.6%
6.650 06/15/18 3.7%
6.700 06/15/18 3.7%
6.700 06/15/18 3.8%
6.500 06/15/18 3.2%
6.900 07/15/18 3.6%
6.750 07/15/18 3.7%
6.875 07/15/18 3.2%
7.000 08/15/18 3.6%
7.250 08/15/18 3.7%
6.900 08/15/18 3.2%
7.250 08/15/18 3.5%
7.250 09/15/18 3.6%
7.150 09/15/18 3.2%
7.000 09/15/18 3.9%
6.800 09/15/18 3.7%
6.750 09/15/18 3.6%
6.650 10/15/18 3.7%
6.750 10/15/18 3.6%
6.650 10/15/18 3.6%
6.800 10/15/18 3.6%
6.750 11/15/18 3.2%
6.700 11/15/18 3.9%
6.500 11/15/18 3.6%
6.500 12/15/18 3.6%
6.500 12/15/18 3.6%
6.400 12/15/18 3.6%
6.250 12/15/18 3.6%
6.250 01/15/19 3.6%
5.900 01/15/19 3.5%
5.900 02/15/19 3.3%
6.000 02/15/19 3.2%
6.000 02/15/19 3.5%
6.000 02/15/19 3.5%
6.000 03/15/19 3.2%
6.000 03/15/19 3.3%
6.000 03/15/19 3.5%
6.000 03/15/19 3.5%
6.000 03/15/19 3.5%
6.000 04/15/19 3.5%
6.350 04/15/19 3.5%
6.200 04/15/19 3.6%
6.250 04/15/19 3.5%
6.500 05/15/19 3.7%
6.750 05/15/19 3.5%
6.750 05/15/19 3.7%
6.750 06/15/19 3.7%
6.600 06/15/19 3.7%
6.700 06/15/19 3.7%
6.750 06/15/19 3.7%
6.600 06/15/19 3.7%
6.350 07/15/19 3.2%
6.350 07/15/19 3.6%
6.250 07/15/19 3.7%
6.300 08/15/19 3.6%
6.300 08/15/19 3.6%
6.050 08/15/19 3.2%
6.150 08/15/19 3.5%
6.050 08/15/19 3.5%
6.100 09/15/19 3.5%
6.150 09/15/19 3.2%
6.000 09/15/19 3.5%
6.000 09/15/19 3.5%
5.900 10/15/19 3.4%
6.150 10/15/19 3.2%
6.050 10/15/19 3.2%
6.125 10/15/19 3.2%
6.400 11/15/19 3.4%
6.400 11/15/19 3.5%
6.550 12/15/19 3.2%
6.550 12/15/19 3.2%
6.700 12/15/19 3.7%
6.500 01/15/20 3.3%
6.650 02/15/20 3.7%
6.500 02/15/20 3.3%
6.750 03/15/20 3.7%
9.000 07/15/20 3.7%
9.000 07/15/20 3.7%
8.750 08/15/20 2.6%
8.250 08/15/20 2.0%
7.000 09/15/21 3.6%
7.000 09/15/21 3.6%
7.000 06/15/22 3.4%
7.000 11/15/23 3.2%
7.000 11/15/24 3.6%
7.000 11/15/24 3.4%
7.000 11/15/24 3.2%
7.250 01/15/25 3.5%
7.150 01/15/25 3.2%
7.250 02/15/25 3.2%
7.250 03/15/25 3.2%
7.150 03/15/25 3.2%
7.500 03/15/25 3.6%
8.000 03/15/25 3.1%
8.000 11/01/31 2.7%
8.000 11/01/31 2.8%

Once again, you’ll notice that the 6.75’s of ’18 are identified by my automated process as being the mostest yield for the shortest holding-period. So, if you were of a mind to buy a bit of GMAC's debt, that particular issue wouldn’t be a bad one to grab for more reasons than just its yield (provided, of course, that you could get in on an ASK of 87.403 or better, or 88.498 all-in if the trade were done through Zions Direct). http://cxa.marketwatch.com/finra/BondCenter/BondTradeActivit...

Charlie
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