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Yield Matters   

13 November, 2018

XTB Price Sheets

Ride The Floating-Rate Bond Wave

Floating-rate bonds are in hot demand
No one knows for certain when rates will move higher. But after 27 months with the cash rate at 1.50%, many investors think a rise must be on the horizon. As a result, floating rate bonds are in hot demand, with Citi seeing a five-fold increase in demand this year from their wholesale investors. Trading as a spread over BBSW means they move up when rates do. We take you through the key considerations when deciding if floating-rate bonds are right for your clients. 
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The Six Key Facts Behind BBSW

What is BBSW and how is it calculated 

With an increase in demand for floating rate bonds there is more focus on the bench mark rate over which they are set. What exactly is BBSW, how is it calculated and by whom? In this article we address frequently asked questions regarding BBSW which may help you explain the essentials to your clients.

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Bond Market: The Month That Was

Keep up to date with our monthly market reviews from CIO Ian Martin

October was a mixed month for global bond markets. Comments from the Federal Reserve in the USA emphasized their confidence in the US economy. However, weaker equity markets stopped US bond yields reaching new highs. In Australia, the CPI data supported the view that the RBA will remain on hold in the near term. This resulted in a positive month for Australian bond investors. 

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Three more XTBs mature in November. If you have clients holding any of these XTBs it's time to start planning which XTB to invest in next. 

Upcoming XTB coupons

13 NOV: YTMCCA - Coca Cola 4.25% 13 NOV 2019 
13 NOV: YTMLL1 - Lend Lease 6.00% 13 MAY 2020
13 NOV: YTMLLC - Lend Lease 5.50% 13 NOV 2018  MATURING
19 NOV: YTMAWC - Alumina 6.75% 19 NOV 2019
19 NOV: YTMQF3 - Qantas 7.75% 19 MAY 2022 
20 NOV: YTMF05 - NAB BBSW + 0.85% 20 MAY 2019
23 NOV: YTMCTX - Caltex 7.25% 23 NOV 2018  MATURING
23 NOV: YTMSG2 - Stockland 4.50% 23 NOV 2022
25 NOV: YTMSG1 - Stockland 8.25% 25 NOV 2020
29 NOV: YTMDOW - Downer Group 5.75% 29 NOV 2018  MATURING


Keep up to date with XTB coupon dates on our website calendar, or follow us on Twitter or LinkedIn

Recent bond transactions 

12 NOV: La Trobe Financial launches new RMBS deal
12 NOV: Christchurch City plans six-year domestic deal
12 NOV: Westpac launches AT1 capital deal 
12 NOV: BNZ launches new five-year domestic deal
12 NOV: SAFA launches syndicated tap of May 2028  select line
12 NOV: Toyota Australia considers benchmark Australian dollar deal
12 NOV: J.P. Morgan Chase launches multi-tranche callable deal

KangaNews has an excellent summary of the latest bond transactions: View here

Contact us

If you have any questions on the content included in Yield Matters or need help with anything regarding XTBs, please contact us on 1800 995 993 or email advisers@xtbs.com.au
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DISCLAIMER: Australian Corporate Bond Company Ltd (ABN 34 169 442 657, Authorised Representative No.: 469037) (“ACBC”) is an Authorised Representative of Theta Asset Management Ltd (ABN 37 071 807 684, AFSL No.: 230920) (“Theta”). Theta is the Responsible Entity of the Australian Corporate Bond Trust (ARSN 603 010 779) and the issuer of the Exchange Traded Bond Units (“XTBs”). ACBC is the Securities Manager of the XTBs. ACBC and Theta will earn fees for making the XTBs available to investors, which is payable at the time that an Authorised Participant applies for an XTB.
 
Email transmission cannot be guaranteed to be secure or error-free as information could be intercepted, corrupted, lost, destroyed, delayed in transmission, incomplete, or may contain viruses.
 
ASX have approved the XTBs for quotation on ASX pursuant to the AQUA Rules. Further a Product Disclosure Statement (“PDS”) dated 6 May 2015 has been lodged with ASIC. Further Classes of XTBs may be made available pursuant to separate PDS, those Classes of XTBs will be made available once they have been approved for quotation by ASX and the relevant PDS has been lodged with ASIC. Investors should read the PDS that relates to that Class of XTB prior to making an investment decision, with or without the assistance of their professional legal, accounting and financial advisers.
 
The information contained in this email is confidential and may not be further disseminated to any person.  The information contained in this email is general in nature and does not take into account any particular investors personal circumstances, objectives or needs. It is not personal financial product advice. It is only made available to wholesale investors within the meaning of section 761G of the Corporations Act (2001).  
 
ACBC is solely responsible for the contents of this email. The contents of a PDS and this email are subject to change and ACBC makes no warranty, express or implied, as to the completeness of any statement contained herein nor does it represent that this email contains all of the information that an investor may require in order to assess the merits of an investment in XTBs.
 
The distribution of this email or any other material relating to XTBs, including a PDS, to persons outside of Australia may be restricted by law and any person who comes into possession of such documents should seek their own advice on, and observe any such restrictions.
 
Data in this email has been sourced from external parties believed to be reliable and has not been verified. Accordingly ACBC and Theta (and each of their directors, officers, consultants and employees) makes no warranty as to the accuracy or validity of any of the statistics quoted. To the extent permitted by law none of these parties are liable for any loss or damage arising from reliance on the content of this material. 

XTB® is a registered trade mark of Global Bond Exchange Pty Ltd, a related body corporate of Australian Corporate Bond Company Limited.

Copyright © 2018 Australian Corporate Bond Company, All rights reserved.


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