Retail bond update – stock market crash gives attractive bond yields

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The retail bond situation has completely changed from 1 month ago. Yield are now very attractive.

  • The high yield bonds of Oxley, Perennial, and Aspial now gives YTM of >20%.
  • The yields of blue chips Astrea, DBS, CapitaMall, and Fraser are between 4 to 8%.
  • And surprise! SIA bond is definitely not attractive at 3.69% YTM. Just 1 week ago, at the price of 0.82, it was giving a whopping yield of 8% YTM.

My preferred choices in this market are

  • DBS bank 4.7% NCPS. YTC is 4.96%. Its very likely that DBS will call back this preference share in Nov this year. Most likely they will issue another Basel III perp to replace it.
  • FP TREA S$500M3.65%B220522 YTM is 7.75%. Matures in slightly over 2 years.
  • CapitaMallTrb3.08%210220 YTM is 4.21%. Maturity is 11 months away.

These are very good returns with short maturity, when compared with fixed deposits. I like to use my SRS account to buy retail bonds. However, what is cheap now may become cheaper.

As much as I love bonds, in this current market, I prefer stocks.

  • I'm a remisier with Maybank Securities, and as a bonds and REITs investor myself, I guide my clients to build resilient bonds and REITs portfolios. If you like to be guided, please open a trading account to become my client; It's free!