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Effective duration and Convexity of bonds
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Scubidu
#51 Posted : Wednesday, September 29, 2010 6:23:40 PM
Rank: Veteran

Joined: 9/4/2009
Posts: 700
Location: Nairobi
From a return point of view KenGen makes more sense than HF esp for liquidity. But this isn't being marketed to retailers, so it's a godsend for fund managers. From a business risk point of view, I can't put money in a bank with rising cost of funds and falling lending rates. Btw subordinate liabilities have other conditions to qualify for capital other than duration (refer to post 44). That's why i hope the turnaround on these bond funds is fast and they'll not just park it in govt debt.
“We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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mwanahisa
#52 Posted : Wednesday, September 29, 2010 6:40:06 PM
Rank: Elder

Joined: 6/2/2008
Posts: 1,438
@Scubidu,

Ireri was on telly a week or so ago indicating that HF intends to have disbursed these funds by March next year. Looking at the way they have grown their loan book over the last 2 years while having to borrow from other banks, I think this is realistic.

@Scooby,

Unless you can make capital gains by trading the bond on the secondary market, under the current bullish environment, the returns on the stock are bound to be higher than the yield on the bond. As for risk adjusted return - I am not sure. I am referring to HF on this.
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Scooby
#53 Posted : Wednesday, September 29, 2010 7:10:43 PM
Rank: Member

Joined: 9/2/2006
Posts: 121
Mwanahisa,

The question of whether one could invest in shares or bonds depends on their own risk profile and expectations of returns commensurate with their risk.

In your case, you seem to be comfortable with investing in HF shares...good for you.

As someone said in Wazua, you can ask X people for their opinion and you can be sure of getting X different opinions.

Regards
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mwanahisa
#54 Posted : Thursday, September 30, 2010 8:06:33 AM
Rank: Elder

Joined: 6/2/2008
Posts: 1,438
C'est vrai - That is indeed true!
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Scubidu
#55 Posted : Saturday, October 02, 2010 5:36:42 PM
Rank: Veteran

Joined: 9/4/2009
Posts: 700
Location: Nairobi
But alas. That's what this forum is about non? Funny thing heard that same comment describing asking questions to economists, traders, now stock-pickers (u can only use it only so many times before it's meaningless). Nway the auction is over. Any projections on subscription?
“We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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Scubidu
#56 Posted : Tuesday, October 05, 2010 10:39:31 AM
Rank: Veteran

Joined: 9/4/2009
Posts: 700
Location: Nairobi
http://www.businessdaily...0/-/gdos82z/-/index.html
“We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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Scubidu
#57 Posted : Wednesday, October 06, 2010 12:40:04 PM
Rank: Veteran

Joined: 9/4/2009
Posts: 700
Location: Nairobi
Absolutely reckless...oversubscribed by 41% and will exercise the greenshoe option. Let's wait and see the impact in next year's financials. 9b in debt @ about 7.5%.
“We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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Scooby
#58 Posted : Thursday, October 07, 2010 5:06:00 PM
Rank: Member

Joined: 9/2/2006
Posts: 121
Scubidu,

I knew the bond would be oversubscribed...and a greater portion of investors would prefer the "fixed" bond and not the "floating" bond. I was expecting a greater portion of investors to take up the fixed portion like it was the case with CfC Stanbic.

Maybe they thought that they could earn a higher interest rate than the fixed bond...which I doubt it will happen due to the excess liquidity in the market. This is probably the new "normal" in our fixed income market right.

Out of curiosity, would you like for us to have more discussions about HF in mwanahisa's forum? We could also try to figure out the impact of this bond on the company.

That way we all try to figure out if there is something to worry (or not worry) about the company...regardless of whether one would prefer to invest in that bond or in shares.
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Scubidu
#59 Posted : Thursday, October 07, 2010 5:30:42 PM
Rank: Veteran

Joined: 9/4/2009
Posts: 700
Location: Nairobi
@scooby. Which one?

http://www.wazua.com/for...spx?g=posts&m=24232

or

http://www.wazua.co.ke/f...spx?g=posts&m=111676
“We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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Scooby
#60 Posted : Thursday, October 07, 2010 5:54:28 PM
Rank: Member

Joined: 9/2/2006
Posts: 121
Scubidu,

Am taking about the second forum...thanks for finding the link.

Cheers
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