NBPS - a 2yr ZDP offering a YTM of 5.59%pa

[SKYSHIP]

At the moment many are simply buying bonds to park cash in the short-term; so really looking at a maturity sub 2yrs. Obviously YTMs are therefore quite a bit lower than longer dated corporate bonds.

I have however found an effective 2yr bond, very secure, with a YTM of 5.59%.

NBPS is a Zero Dividend Pref share, the now sole one (another redeemed a month ago) issued by NB Private Equity (NBPE). The bond is covered 17x by NBPE Net Assets. Matures at 130.63p on 30/10/24.

Someone sold a few recently & MMs are simply passing on the stock; so offered at 118.9p a few days ago (YTM @ 4.8%); but at the moment possible to buy at 117.12p for 5.59%pa. That's a 2yr gain of 11.5% - A great BUY IMO. An anomaly worth picking up...

[88V8]

More by luck than judgement, I managed to avoid the zeroes debacle.

This does look quite attractive, >5%pa tax-free subject to CGT.
Headroom of 17x NAV should be safe, although I do see that some of their top holdings seem to be unquoted, which raises the question of who assesses the NAV.

By maturity, we may be in a different world as regards inflation/interest rates, and >5% net of tax may seem a decent return once more.

V8

[SKYSHIP]

88V8 - That zeroes debacle provided some great opportunities. Some people with more knowledge than me at that time made serious fortunes out of picking up the capital shares for next to nothing.

I was happy to have two years of 30%+ growth in my SIPP through trading the Zeroes, foolishly discarded by investors and brokers who should have known better.

Nowadays the ZDPs are a rare animal; but this one provides a useful opportunity in strange times.

[SKYSHIP]

NBPS - made a small top-up purchase this morning @ 118.28p.

With maturity 30/10/24 @ 130.63p, that means they now have a YTM of 5.3%pa.

Look at it another way - a 10.44% gain in 23months.

Very secure, covered 17x by NBPE's net assets - see the B/S in the latest Fact Sheet accessible through NBPE's website:

https://www.nbprivateequitypartners.com/

[88V8]

NBPS - made a small top-up purchase this morning @ 118.28p.
With maturity 30/10/24 @ 130.63p, that means they now have a YTM of 5.3%pa.

Istm that unless in a tax shelter Hunt's attack on the CGT allowance will knock the stuffing out of zeroes.
End of an era n'all that.

V8

[monabri]

Doesn't appear to be tradable on iWeb.

interactive investors may ( I say "may" as I haven't tried it) allow trading if one searches for NBPS (GG00BD96PR19).

Note, the share is domiciled in Guernsey. Whether that matters for CGT purposes I dont know (comments invited).

(it would certainly be a consideration if we were talking 'conventional' dividend payments & foreign income allowances).

[genou]

Note, the share is domiciled in Guernsey. Whether that matters for CGT purposes I dont know (comments invited).

Makes no difference.