9厘回報無煩惱?

Hi there,
I am your big fan of your blog. I have read pretty much all your posts. Now I have a quick question for you.
On the blog, you said
“澳元可放在澳洲銀行買入短債,7%年息可達。”

 

I have an Australia commonwealth bank account. The bond you said here refers to investment growth bonds?
http://www.commbank.com.au/personal/financial-planning/investment-products/investment-growth-bond/returns-fees.html

 

I am a beginner and I have no experience. If you check out the performance report on the link, the returning is quite unstable and it could end up like around 4% in most of the chances, which is the same as term deposit. Or I am reading it wrong..

 Cheers,
Eric

 

answer

Hi Eric,

Answering your question is not easy, it is better to have offline talk on our course. And that’s why we invite people to our course. We need to add an disclaimer before do some education now.
Disclaimer: We are not offer products nor giving advise on investment. It is a education topic on bond price and yield

 

Here are the example:

1.Morgan Stanley AUD bond mature April 2017, first year 2017 and variable after

Coupon: 9.00 (first year, floats at 3 mo. LIBOR plus % in later years)

Maturity: 4/30/2017

Pays:  Quarterly

Rating: A-

Price: 100.0

Yield to Maturity: VAR

 

 

2.Goldman Sachs Quarterly Pays with Yield to Maturity 7.11% mature on 2016

Coupon: 4.98

Maturity: 4/12/2016

Pays: Quarterly

Rating: A1/A-

Price: 92.6

Yield to Maturity: 7.11%

Bond holder exposes to issuer risk. You know that?

One Response to 9厘回報無煩惱?

  1. Kelvin says:

    Eric,

    The investment product that you referred is actually an insurance product, generally known as “Portfolio Bonds”. In your case, it is called “Investment Growth Bonds”. The underlying are mutual funds but Portfolio Bonds tend to have a extra layer of fees as well as lock up periods.

    You can check with CBA that you would like to invest directly in the mutual funds which pays dividend. From my understanding, the Hong Kong branch has available various mutual funds at relatively low cost through a mutual fund platform. If you are in Australia, there are even more platforms for mutual funds that you can choose from.

    Cheers,
    Kelvin


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