20 Jun – 24 Jun 2016

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The median trading margin for ASX-listed floating rate notes fell back to finish the week at 2.57%, down from 2.72%. It was an unexpectedly positive result given the general rise in yields of ASX-listed securities which occurred at the end of the week. It also demonstrated the ability of investors to differentiate between debt instruments and hybrid securities which have both debt and equity characteristics, rather than selling everything in sight because it is listed on a “share market”.

listed-notes-jun24

Not all notes and bonds in this segment fared well. The diagram below shows movements on Friday and why some yields fell while others rose, especially those coming from the same issuer, is a bit of a mystery. Suncorp Notes (ASX code: SUNPD) have a Basel III non viability clause which makes them less of a vanilla bond and a little closer to a convertible note, which may be the rationale behind the rise in its margin.

financial-notes-jun24

ASX LISTED FLOATING RATE NOTES

COMPANY
$100
Face Val
CODEBOND
TYPE
MATURITYISSUE
MARGIN
TRADING
MARGIN
Δ WEEKWEEK
CLOSE
YTM
Est**
AGLAGLHASub Note8-Jun-193.80%3.29%0.00%101.615.24%
AMPAMPHASub Note II18-Dec-182.65%1.81%-0.26%101.993.76%
ANZ Banking GroupANZHASub Note II14-Jun-172.75%1.47%-0.17%101.233.42%
APT PipelinesAQHHASub Note31-Mar-184.50%3.40%-0.12%101.705.35%
Australian UnityAYUHBBond15-Dec-202.80%1.80%-0.17%105.013.75%
ColonialCNGHASub Note31-Mar-173.25%2.16%-0.20%100.684.11%
CaltexCTXHASub Note15-Sep-174.50%2.51%-0.44%102.474.46%
CrownCWNHASub Note14-Sep-185.00%7.67%0.56%94.899.62%
CrownCWNHBSub Note23-Jul-214.00%8.43%0.29%83.1510.38%
Goodman GroupGMPPASub Note30-Sep-183.90%3.70%-0.12%100.305.65%
Bentham IMFIMFHABond30-Jun-194.20%5.60%0.52%97.507.55%
Nat Aust BankNABHBSub Note II18-Jun-172.75%1.75%0.11%100.963.70%
OriginORGHASub Note22-Dec-164.00%6.11%-0.39%99.008.06%
Suncorp MetwaySUNPDSub Note III21-Nov-182.85%2.57%0.20%101.004.52%
TabcorpTAHHBSub Bond22-Mar-174.00%2.81%-0.20%100.854.76%
TattsTTSHASnr. Bond5-Jul-193.10%2.04%0.19%105.003.99%
WestpacWBCHASub Note II23-Aug-172.75%2.04%0.19%101.163.99%
WestpacWBCHBSub Note III22-Aug-182.30%2.21%0.04%100.504.16%
WoolworthsWOWHCSub Note24-Nov-163.25%2.79%0.06%100.584.74%

ASX LISTED FIXED RATE BONDS

COMPANYCODETYPEMATURITYCOUPONWEEK
HIGH
WEEK
LOW
WEEK
CLOSE
YTMNEXT DIV
AND EX
DATE
Heritage BSHBSHBSnr Bond20/06/20177.25%103.60103.09103.303.88%$1.813 on 9 Sep 2016 (E)

ASX LISTED CONVERTIBLE NOTES

COMPANYCODEFACE
VALUE
MATURITYWEEK
HIGH
WEEK
LOW
WEEK
CLOSE
YTMSIZE
($m)
Aust FoundationAFIG$100.0028-Feb-17109.00108.15108.2011.76%$3.13 on 19 Aug 2016 (E)

** YTM for floating rate securities is an estimate using current interest rates. This will vary if rates change.
Source: Evans & Partners. Dealing Contact Michael Saba +61 3 9631 9813