SIA 5-year retail bonds

[Pocoyoz]

Fraser property treasury 3.65% 2022 drop till 0.925.
Can switch ?

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[Newbyib]

Are you guys selling? It’s 10% below issuance already

Curious, who are the buyers and if there are any, why are they buying?

 

[cherry6]

redeemed alr
didn't filter out
interface not user friendly

Then why people still bidding for a matured already and redeemed bond. Have 'ask, YTM' interest.

 

[Pocoyoz]

Then why people still bidding for a matured already and redeemed bond. Have 'ask, YTM' interest.

If you click the bond, it'll show redeemed.
Bug.

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[vsvs24]

Curious, who are the buyers and if there are any, why are they buying?

People who feel that SIA will not go under.

 

[Newbyib]

People who feel that SIA will not go under.

I don’t think it will go under because the political costs are too heavy. I think it will be capital injection or shares placement to Temasek and alliance in the worst case. Then limp along until recovery. It could sell off the holdings in the subsidiaries if any also. Anyway if nationalise, I expect the G to honor the bonds because if not you have political repercussions again. But then there is just this slight chance that they will contort their way out. My views.
Still, I am wondering who is buying. I came across an interview by some top quants who recommend to buy high yield bond in a contrarian approach during crisis - not sure if some pple are executing those type of strategies. But they will of course rely on metrics like zscore and analysis to protect them.

 

[BwaySaiDonk]

I don’t think it will go under because the political costs are too heavy. I think it will be capital injection or shares placement to Temasek and alliance in the worst case. Then limp along until recovery. It could sell off the holdings in the subsidiaries if any also. Anyway if nationalise, I expect the G to honor the bonds because if not you have political repercussions again. But then there is just this slight chance that they will contort their way out. My views.
Still, I am wondering who is buying. I came across an interview by some top quants who recommend to buy high yield bond in a contrarian approach during crisis - not sure if some pple are executing those type of strategies. But they will of course rely on metrics like zscore and analysis to protect them.

don't forget NOL
there are many way to get out of it
worst privatize at low price

 

[oceanicmanta]

while the retail tranche is trading way below par, the institutional tranches are still trading above or close to par ... all tranches are similarly senior unsecured and unrated (granted coupons & maturity are different)

if there is risk of SIA default, would think all tranches will be similarly affected ??

perhaps there is over-selling in the retail segment ?

or something the institutional investors know that retail investors dont ?

vested in retail tranche

 

[Newbyib]

don't forget NOL
there are many way to get out of it
worst privatize at low price

Yeah, can also try a merger and acquisition like NOL. But I had a brief look at the analyst report, don’t think it’s in that bad shape yet. Only thing is how long this crisis will last and the final impact.
https://research.sginvestors.io/2020/03/singapore-airlines-sia-dbs-group-research-2020-03-19.html?m=1

 

[Newbyib]

while the retail tranche is trading way below par, the institutional tranches are still trading above or close to par ... all tranches are similarly senior unsecured and unrated (granted coupons & maturity are different)

if there is risk of SIA default, would think all tranches will be similarly affected ??

perhaps there is over-selling in the retail segment ?

or something the institutional investors know that retail investors dont ?

vested in retail tranche

How much below par? 0.95? I see all the perpetuals hammered even worse - DBS, frasers etc if it’s that case.
Wondering who are the ones on the other side of the trade and what is their trade plan.

 

[DukeCS33]

while the retail tranche is trading way below par, the institutional tranches are still trading above or close to par ... all tranches are similarly senior unsecured and unrated (granted coupons & maturity are different)

if there is risk of SIA default, would think all tranches will be similarly affected ??

perhaps there is over-selling in the retail segment ?

or something the institutional investors know that retail investors dont ?

vested in retail tranche

Are you saying that the offer in Insto is above par while the offer in retail space is below par?

The bid offer spread is wide in retail...

 

[oceanicmanta]

Are you saying that the offer in Insto is above par while the offer in retail space is below par?

No.

I am referring to the Bid-Ask prices of the Retail Bond (ie SIASP 3.030% 28Mar2024) .. trading at 88.933 - 88.033

vs those bonds for Institutional/ AI (ie SIASP 3.160% 25Oct2023) trading at 100.342 - 99.313

I shld have said referred to Retail Issue vs Insti Issue (instead of using tranche)

 

[DukeCS33]

No.

I am referring to the Bid-Ask prices of the Retail Bond (ie SIASP 3.030% 28Mar2024) .. trading at 88.933 - 88.033

vs those bonds for Institutional/ AI (ie SIASP 3.160% 25Oct2023) trading at 100.342 - 99.313

I shld have said referred to Retail Issue vs Insti Issue (instead of using tranche)

They are different issues carrying differing coupons and maturity. Its not a like for like comparison.

 

[lightchaser]

They are different issues carrying differing coupons and maturity. Its not a like for like comparison.

mmm..but both are also bonds issued by the same entity ? If SIA goes under and Temasek refuses to honour the bonds, both will also be similarly affected irregardless of coupons etc ? maybe the insti bonds have 1 year earlier maturity but shd not make much difference since crisis is now ?

 

[lightchaser]

No.

I am referring to the Bid-Ask prices of the Retail Bond (ie SIASP 3.030% 28Mar2024) .. trading at 88.933 - 88.033

vs those bonds for Institutional/ AI (ie SIASP 3.160% 25Oct2023) trading at 100.342 - 99.313

I shld have said referred to Retail Issue vs Insti Issue (instead of using tranche)

Can share where to find this Institutional/ AI (ie SIASP 3.160% 25Oct2023) prices ?

 

[DukeCS33]

mmm..but both are also bonds issued by the same entity ? If SIA goes under and Temasek refuses to honour the bonds, both will also be similarly affected irregardless of coupons etc ?

I was referring to the price differences between the retail vs the insto issues and not about bailing out. The way to look at bonds is to look at the effective yield to maturity for that tenor and to see if there is an anomaly against other runs or if there is a kink within the constructed yield curve.

 

[arcan3]

THe retail does not have enough bid to support the price... I think might drop even further because of lack of bid

 

[lightchaser]

I was referring to the price differences between the retail vs the insto issues and not about bailing out. The way to look at bonds is to look at the effective yield to maturity for that tenor and to see if there is an anomaly against other runs or if there is a kink within the constructed yield curve.

sorry dun quite understand..so are we saying that the yield n maturity date of the insto bonds are better than the retail one so prices hold firmer ? thks.

 

[oceanicmanta]

I was referring to the price differences between the retail vs the insto issues and not about bailing out. The way to look at bonds is to look at the effective yield to maturity for that tenor and to see if there is an anomaly against other runs or if there is a kink within the constructed yield curve.

still the huge disparity is glaring ...

it seems that the Insti Issue is priced at a much tighter credit risk premium than the Retail issue ... what could be the reasons ??

arcan3 mentioned liquidity - a possibility ... if so, it's not good for Retail investors

 

[arcan3]

because the Insti Issued bond price are market made by the bank. In retail market, there is no market maker. Thus, no liquidity in retail market, coupled with the selling by retailer, the price will suffer since no retailer dare to stand at the bid with large buy volume...