Recently, Bell Potter’s fixed income desk recommended holders of Westpac CPS (ASX code: WBCPC) switch into NAB Notes (ASX code: NABPC). Not because there is anything particularly wrong with the Westpac hybrids but simply due to the yield differential and the potential gain to be had. NAB’s hybrids have a March 2019 call date while Westpac’s have a March 2018 call date, so one would expect the NABs to have a slightly higher trading margin on this basis alone. However, the team at Bell Potter think the difference is too large and one worth exploiting.
(As at the close of business 21 July, 2016)