FPL green notes 5 years 4.49% pa

[BBCWatcher]

was it considered a loss when you sold (excluding the passive dividends you have been receiving) from the price bought?

The SIA 3.03% retail bond is currently trading a little below par, so selling that particular bond now would result in a small capital loss. Yes, of course you should factor any capital loss you experience into the net effective total returns. The net effective yield in that event would be something below 3.03% nominal...

...And then you get to translate the net effective nominal yield to a net effective real yield. Which is probably negative at this point in time (with a hypothetical sale today).

 

[d5dude]

and during the market correction, its market value was preserved

Not sure what market correction you are referring to but it crashed to 80c on the dollar during the covid crash so it did a lot worse than SGS or even IG bonds. Also SIA only survived because it was bailed out by the gov, investors who got out of this unscathed might not be so lucky next time...

 

[demoforce1]

The SIA 3.03% retail bond is currently trading a little below par, so selling that particular bond now would result in a small capital loss. Yes, of course you should factor any capital loss you experience into the net effective total returns. The net effective yield in that event would be something below 3.03% nominal...

...And then you get to translate the net effective nominal yield to a net effective real yield. Which is probably negative at this point in time (with a hypothetical sale today).

it is 1.01 now, above the initial price
https://www.sgx.com/securities/equities/SQ1B

 

[brianlee_sg]

Sorry for pouring cold water.
I am also tempted to buy some but I still remember Hyflux.

 

[silverbomb]

The SIA 3.03% retail bond is currently trading a little below par, so selling that particular bond now would result in a small capital loss. Yes, of course you should factor any capital loss you experience into the net effective total returns. The net effective yield in that event would be something below 3.03% nominal...

...And then you get to translate the net effective nominal yield to a net effective real yield. Which is probably negative at this point in time (with a hypothetical sale today).

i see. how liquid or relative ease of selling it if one indeed wants to liquidate and sell off such bonds? for one, i know T-Bill are not easily sold so i'm thinking of the ease of sales.

 

[SDM1974]

Sorry for pouring cold water.
I am also tempted to buy some but I still remember Hyflux.

Buy some. No need to go all in.

 

[WHLN17]

Sorry for pouring cold water.
I am also tempted to buy some but I still remember Hyflux.

Sure, there is risk but to be fair, only one Hyflux out of so many corporate bonds so the default rate is not high.

 

[limster]

yes, its super annoying. I sold some of my SIA 3.03% retail bonds recently in CDP, had to use poems as FSMOne doesn't support.

I sold half my SIA bonds in August 2020 at $1.01 to boost up my warchest which was depleted after the great singapore sale.

I'm still holding a reasonable amount of SIA 3.03% and collecting coupon payments on those

Those that know the industry better know why Temasek had to shore up confidence in SIA.

 

[lzydata]

Actually Hyflux was preference shares not bonds but who cares eh. Every retail product issuer is Hyflux now

 

[limster]

Actually Hyflux was preference shares not bonds but who cares eh. Every retail product issuer is Hyflux now

its true that some investors are unable to do their own fundamental analysis so they are easily influenced by those that spread fear..... on the other hand, there are those who understand a bit about FA and can tell the difference between Fraser's previous 3.65% bond and Hyflux perps....

When the hyflux perps came out, I did my sums and concluded that I wouldn't touch them with a 10 foot pole. Similarly Eagle Hospitality Trust.

Even though I like having passive income magically appear in my bank account every month, even I had to draw the line at EHT and Hyflux .

 

[Guojing88]

Not sure what market correction you are referring to but it crashed to 80c on the dollar during the covid crash so it did a lot worse than SGS or even IG bonds. Also SIA only survived because it was bailed out by the gov, investors who got out of this unscathed might not be so lucky next time...

Yes, to be fair, just before it was announced in Parliament that the govt would support SIA thru Temasek, I was holding those retail bonds and I thought there was a real chance that SIA could default on those bonds.

 

[dude123]

The only risk is that if FPL goes bankrupt then we will lose our money right? Never buy any bonds in my life before, this fraser bonds can try ?

 

[churnmaster]

Yes, to be fair, just before it was announced in Parliament that the govt would support SIA thru Temasek, I was holding those retail bonds and I thought there was a real chance that SIA could default on those bonds.

I was pretty sure the airline would survive though some kind of restructuring would be required for sure. Bought at 84c in the waterfall drop and sold the same at 96c in about 2 weeks. Interesting to know someone sold above $1 in that waterfall drop.

 

[small-onion]

what happens after the 5 years? do they automatically sell off the notes and you get back the principle ?

 

[d5dude]

I was pretty sure the airline would survive though some kind of restructuring would be required for sure. Bought at 84c in the waterfall drop and sold the same at 96c in about 2 weeks. Interesting to know someone sold above $1 in that waterfall drop.

And restructuring would have forced bondholders to take some sort of haircut. I actually posted about this on an SSI thread when I saw that junk bond indices were already crashing but SIA 3.03% was still trading at 100, my advice then was to dump it before it tanks, and it did tank a couple of days later.

Actually Hyflux was preference shares not bonds but who cares eh. Every retail product issuer is Hyflux now

Hyflux is definitely not the only company that has defaulted on its bonds in the last decade, numerous other companies have defaulted, my point is not that FPL is also going to join this list but that investors should DYODD, understand what the risks are before they decide if they want to put their money in this.


https://forums.hardwarezone.com.sg/...ations-and-positioning.6183736/post-125420853
Oh it looks like my advice was to limster back then.

 

[omgwtflol]

okay.

So if i were to take an example,

The current Great Eastern 2.7 percent 2 year endowment. Even though it listed its interest and capital guaranteed, it has the same credit risk to this FPL product since if GE decided to close shop or FPL close shop, both products wont be able to payout the capital/interest.

Just an analogy.

Wrong. GE insurance should be backed by SDIC.

 

[sohguanh]

what happens after the 5 years? do they automatically sell off the notes and you get back the principle ?

I think for bond if they say 5 years means redeem they give you back principal if you hold to maturity? But risk is Frasers can be like Hyflux case then your capital can get back is big question mark

So want to buy put some a bit not all in. How much is some you decide as your own monies

 

[limster]

And restructuring would have forced bondholders to take some sort of haircut. I actually posted about this on an SSI thread when I saw that junk bond indices were already crashing but SIA 3.03% was still trading at 100, my advice then was to dump it before it tanks, and it did tank a couple of days later.




Hyflux is definitely not the only company that has defaulted on its bonds in the last decade, numerous other companies have defaulted, my point is not that FPL is also going to join this list but that investors should DYODD, understand what the risks are before they decide if they want to put their money in this.


https://forums.hardwarezone.com.sg/...ations-and-positioning.6183736/post-125420853
Oh it looks like my advice was to limster back then.

https://forums.hardwarezone.com.sg/...ations-and-positioning.6183736/post-125426737
Nice to look back at previous posts to see who panicked during the correction and who went shopping Like I mention in the linked post above, those with balanced portfolio can rebalance by selling bonds to buy cheap stocks.

I guess some became so fearful that they decided to dump their bonds below face value. I sold at $1.01 in August 2020 to boost my depleted warchest

because of certain adverse consequences to Singapore that would follow a technical default of SIA (debt restructuring is usually regarded as a technical default in many contracts) I was pretty confident that the bonds would be supported... at the expense of shareholders.....

Those consequences are unique to airlines... if it was a Temasek linked company in another sector like rig-building, I would not have similar confidence that their bonds would be supported.

 

[lzydata]

what happens after the 5 years? do they automatically sell off the notes and you get back the principle ?

Unless previously redeemed or purchased and cancelled, the Notes will be redeemed on 16 September 2027. Noteholders will receive semi-annual interest payments on 16 March and 16 September in each year, commencing on 16 March 2023.

From the press release.

 

[sohguanh]

Long time never use OCBC apply IPO seem the OCBC mobile app no such feature to tap but internet browser login got. App and website are not created equal once again