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Hello Heylo

Gilts, bonds, and interest-bearing shares
gbjbaanb
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Hello Heylo

#172665

Postby gbjbaanb » October 9th, 2018, 11:45 pm

From ORB today:

Heylo Housing Secured Bond plc announces 1.625% sterling denominated RPI linked retail bond issue due to mature in 2028


RPI is 3.5% currently, though fluctuated between 1 and 5%

Helyo buys properties and then sells them under shared ownership schemes, apparently been going since 2014 and have £300m of properties under contract. So does anyone have any opinions on this bond?

Alaric
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Re: Hello Heylo

#172676

Postby Alaric » October 10th, 2018, 12:31 am

gbjbaanb wrote:So does anyone have any opinions on this bond?


As might be expected, the coupon is higher than a parallel indexed government security. Is it high enough to compensate for the additional risks? If you wanted your income and capital to increase with RPI inflation, it may be worth considering. It might however fall flat on its face with a full or partial default. The investors security is that the modified "buy to let" business proposition is able to trade sufficiently profitably to pay the indexed coupon and the ultimate capital repayment.


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