Pibs and Prefs

[moorfield]

But but but... It says up there ^^^^ issue price 99.83p

So the pibs were initially issued at a discount, your initial £1000 stake costing £998.30, and today worth £585 (slightly less than that actually using the bid price).

[GoSeigen]

But but but... It says up there ^^^^ issue price 99.83p
And GS refers to £58 per 100 bonds

I'm going to bed, my head hurts

Night all

AC, Moorfield has sent me scurrying to the prospectus, but I find no justification there for his interpretation. Perhaps he's referring to some market-maker type of conventions.

This from the prospectus:

Form and denomination
The PIBS are in registered form and are available and transferable in accordance with the Rules in amounts and integral multiples of £1,000.

GS

[moorfield]

AC, Moorfield has sent me scurrying to the prospectus, but I find no justification there for his interpretation. Perhaps he's referring to some market-maker type of conventions.

This from the prospectus:

Form and denomination
The PIBS are in registered form and are available and transferable in accordance with the Rules in amounts and integral multiples of £1,000.

GS

Apologies GS - ignore the bit I wrote about minimum quantity I need to correct that. I've found the web page I was trying to recall/looking for last night, which strictly relates to Bonds not PIBS.

http://thismatter.com/money/bonds/bond-pricing.htm

When bond prices are listed, the convention is to list them as a percentage of par value, regardless of what the face value of the bond is, with 100 being equal to par value. Thus, a bond with a face value of $1,000 which is selling for par, sells for $1,000, and a bond with a face value of $5,000 that is also selling for par will both have their price listed as 100, which means their prices are equal to 100% of par value, or $100 for each $100 of face value.

This pricing convention allows different bonds with different face values to be compared directly. For instance, if a $1,000 corporate bond was listed as 90 and a $5,000 municipal bond was listed as 95, then it can be easily seen that the $1,000 bond is selling at a bigger discount, and, therefore, has a higher yield. To find the actual price of the bond, the listed price must be multiplied as a percentage by the face value of the bond, so the price for the $1,000 bond is 90% × $1,000 = 0.9 × $1,000 = $900, and the price for the $5,000 bond is 95% × $5,000 = .95 × $5,000 = $4,750.

[AleisterCrowley]

I think I sort of understand, although it's all a bit of a muddle.
Apologies for slightly hijacking the original post, but i'm looking for a home for my 25% cash float at the moment - gilts/bonds/prefs/PIBS
There are many pitfalls for the unwary.

[BobGe]

'Apparently' available within my HSDL ISA
5300.00 - 5850.00 (GBX) at 09:52:34
on Market (LSE)
But rejected when I tried to get a live quote to 'buy' some (I wouldn't have completed, just an experiment)

Maybe telephone dealing only, or maybe HSDL will not permit buying these. They wouldn't allow buying Co-op 42TE / 42TF previously.
(Final Repayment Notes 11% 2025 / Instalment Repayment Notes 2025.) Too risky!!

[GoSeigen]

'Apparently' available within my HSDL ISA
5300.00 - 5850.00 (GBX) at 09:52:34
on Market (LSE)
But rejected when I tried to get a live quote to 'buy' some (I wouldn't have completed, just an experiment)

Maybe telephone dealing only, or maybe HSDL will not permit buying these. They wouldn't allow buying Co-op 42TE / 42TF previously.
(Final Repayment Notes 11% 2025 / Instalment Repayment Notes 2025.) Too risky!!

Probably they're just are not set up for trading online, for whatever reason. I've bought them recently through HL, just call their dealers and see if they can help. You'd probably get a better price than online anyway.


GS

[hiriskpaul]

'Apparently' available within my HSDL ISA
5300.00 - 5850.00 (GBX) at 09:52:34
on Market (LSE)
But rejected when I tried to get a live quote to 'buy' some (I wouldn't have completed, just an experiment)

Maybe telephone dealing only, or maybe HSDL will not permit buying these. They wouldn't allow buying Co-op 42TE / 42TF previously.
(Final Repayment Notes 11% 2025 / Instalment Repayment Notes 2025.) Too risky!!

Rationality and HSDL management parted company sometime ago. I actually hold 42TE with them in my iWeb ISA (iWeb is the the same thing as HSDL). They did not bother to tell me that I could no longer buy or sell online, I just noticed one day that the trading button vanished. I also hold the Balfour Beatty pref BBYB with iWeb, but am not allowed to buy any more and have to phone to sell. They are perfectly happy for me to buy the lower ranking ordinary shares, so risk does not come into it. I thought it might be the fact that BBYB was convertible that was the problem (Dangerous Derivatives, Run for the hills!), but that does not seem to be the case either as I am able to buy the Raven Russia convertible RUSC. If you really want to waste half an hour or more discussing why they will not let you trade something, try engaging with them using the online chat.

[Surerera]

FWIW I bought 25,000 WBS on Friday, had to pay 60p for them and couldn't do it on line. I probably paid too much but I fancied a dabble and have a lot of spare cash and not many ideas at the moment.


Surerera

[flyer61]

Hiriskpaul,

are there any Prefs/Pibs that you would buy at the moment?

[BobGe]

Too risky!!

They are perfectly happy for me to buy the lower ranking ordinary shares, so risk does not come into it.

HSDL's risk assessment does, using S&P's ratings IIRC.

(Not saying they understand it... or that it's reflected uniformly in all cases.)

[Surerera]

Well that tender for WBS isn't too generous. I took the knife to mine as soon as I saw the news yesterday at 54.25.

[GoSeigen]

Well that tender for WBS isn't too generous. I took the knife to mine as soon as I saw the news yesterday at 54.25.

Well done getting a decent price Surerera. The retail offer is stingy, but to be fair the price has been far below 51p for a long time.

I wonder how retail will be defined? Hopefully along the lines of the coop reorganisation. I manage well over 100k of these so would prefer the non-retail alternative if at all possible.

Anyone know when a prospectus/detailed notification will appear?


GS

[Surerera]

Thanks GS, I just assumed they'd describe me as retail as I only had 25,000 and stitching up retail seems to be pretty popular these days so I was surprised to see such a good bid.

[GoSeigen]

Weird thing is, the issuer would probably not have tendered for them at, say 50p a year ago when they were trading at 25p, but will probably happily call them at 100p in a few years time!

GS

Hah, I didn't think they'd have the gall to tender at 51p now! That low low price only for retail customers of course. It stinks but I'm not sure I have the stomach for a fight.

Meanwhile instos get a fairly good deal. No wonder there's been a bid in the market...

Cynical, moi?


GS