@feelamong i was first told 11M so i agreed then again i was told i will pay total of 118M...i just told them dont bother..dont want to involve myself in stuff i dont understand.

What the diffrence if i decide to buy 100M at the secondary market today Or should i have still bought at the primary market?

Tritri:
@feelamong i was first told 11M so i agreed then again i was told i will pay total of 118M...i just told them dont bother..dont want to involve myself in stuff i dont understand.

What the diffrence if i decide to buy 100M at the secondary market today Or should i have still bought at the primary market?

I think you should try to read more to understand this.....or just invest in one.

if you go to the secondary market today you will still get the bond but may get it at a higher or lower yield. (this will then determine the price you will pay for this)

feelamong:


sorry bro! better luck next time..

and always try to speak with bond traders before you bid

Thanks.
Will bid again for that of next month.

vacanci:


how come you are paying accrued interest so high when the next coupon paymnt is February 13, 2016. Will you be enjoying the next coupon of february 13, 2016? if not where is the accrued interest coming from?

guru will the total interest covering 2016 feb to 2020 feb be....62 million naira on the investment of 100 million naira....at 15.5 percent

Alikote:
guru will the total interest covering 2016 feb to 2020 feb be....62 million naira on the investment of 100 million naira....at 15.5 percent

Yea...a bit above N62M

feelamong:


Yea...a bit above N62M

how much will it be ....I did 15,500,000 x 4 years =62 million
plus the investment of 100 million
will be intact

Alikote:
how much will it be ....I did 15,500,000 x 4 years =62 million
plus the investment of 100 million
will be intact

it is 15.54% which is 15,540,000X4= 62,160,000

vacanci:


it is 15.54% which is 15,540,000X4= 62,160,000

what will be the expected initial investment at the completion of the tenure ??100 million less or above

Alikote:
what will be the expected initial investment at the completion of the tenure ??100 million less or above

100m

feelamong:


Yea...a bit above N62M

what will be initial investment at feb 2016...need to make a decision

Alikote:
what will be initial investment at feb 2016...need to make a decision

If you can manage to go through all comments for today, you will find answers to all the questions you have been asking today. Feelamong summarized it all up in the investment advice he posted.

SETTLEMENT DATE -12-Feb-16

COUNTTERPARTY -Mr xxxxxxx

BOND VALUE - 100,000,000.00

CLEAN PRICE - 110.3666585

MATURITY DATE - 13-Feb-2020

COUPON RATE - 15.54%

YIELD - 12.19%

ACCRUED INTEREST- 7,727,771.74

DIRTY PRICE - 118.09

TOTAL DUE - 118,094,430.24

@The Oga in the house...

When am i going to get my 1st coupon of Feb2020 FGbond that i bought @14th August 2015...

Will I be paid on 13th Feb.2016 ..which is my 1st 6 months coupon

Cc:
Feelamong
United4Real
IHelp
Vacanci
Carpenter

Etc

vacanci:

it is 15.54% which is 15,540,000X4= 62,160,000

Alikote:
how much will it be ....I did 15,500,000 x 4 years =62 million
plus the investment of 100 million
will be intact

Ur Initial investment will b 118M for you to get 62M interest at the end of 2020. not 100M as u think.

Tritri:






Ur Initial investment will b 118M for you to get 62M interest at the end of 2020. not 100M as u think.

LOL. You didnt invest 118M. The investment is actually 100M. you only spent the additional amount to secure that bond. so have it in mind that your principal amount on which the coupons will be calculated will be the 100M and not the 118M.

ukay2:
@The Oga in the house...

When am i going to get my 1st coupon of Feb2020 FGbond that i bought @14th August 2015...

Will I be paid on 13th Feb.2016 ..which is my 1st 6 months coupon

Cc:
Feelamong
United4Real
IHelp
Vacanci
Carpenter

Etc

Yes. February 13th, you will get ur first alert.

[quote author=unite4real post=42836910]

LOL. You didnt invest 118M. The investment is actually 100M. you only spent the additional amount to secure that bond. so have it in mind that your principal amount on which the coupons will be calculated will be the 100M and not the 118M.[/quote that means u have to another extra 18 million to add to it 100 million ..it confusing need more explanations

@Alikote

You're right..the yield is 12:19% . And as an investor every dollar count at the end it's a 12:19 % return after 5yrs.

unite4real:


Yes. February 13th, you will get ur first alert.

Thanks Sir

Tritri:
@Alikote

You're right..the yield is 12:19% . And as an investor every dollar count at the end it's a 12:19 % return after 5yrs.

if i invest 10 million what will be my,total investment at 2020

Alikote:
if i invest 10 million what will be my,total investment at 2020

Good Question:

If u invest 10M for 2020 Ur total Investment will be 16.2M at maturity , But It doesn't work dat way. Because it might cost u another 1.5M just to book down ur 10M bonds. Total 11.5 , Even in real estate u factor in everything spent. The only lucky people r who bought at first opening when the yield was 15.54 , that my understanding anyway.

Tritri:


Good Question:

If u invest 10M for 2020 Ur total Investment will be 16.2M at maturity , But It doesn't work dat way. Because it might cost u another 1.5M just to book down ur 10M bonds. Total 11.5 , Even in real estate u factor in everything spent. The only lucky people r who bought at first opening when the yield was 15.54 , that my understanding anyway.

Other lucky ones are those that bought when the yield was high. Last September, the 15.54%fgn bond traded at a yield of 15.95%. At this rate, I got it at a discount better than those that bought originally.

unite4real:


Other lucky ones are those that bought when the yield was high. Last September, the 15.54%fgn bond traded at a yield of 15.95%. At this rate, I got it at a discount better than those that bought originally.

some were even lucky enough to get it at 16% when the JP Morgan issue was at its peak and everyone was scared to invest..

at the end of the tenure the rate are actually less than 12 percent cos u minus the extra money used in securing the 15.5 percent

example 100 million bond secured by another 18 million
total interest 62 million -18million =44 million its ur actual profit

plus ur original 100 million naira....but what happen to the extra 18 million naira will be retured

Alikote:
at the end of the tenure the rate are actually less than 12 percent cos u minus the extra money used in securing the 15.5 percent

example 100 million bond secured by another 18 million
total interest 62 million -18million =44 million its ur actual profit

plus ur original 100 million naira....but what happen to the extra 18 million naira will be retured

You are miscalculating it in the end. part of the 18M was the 7.7M coupon payment which you paid to the owner of the bond. By the next coupon payment which is February 13 just 3 days interval, your 7.7M comes back to you. if you do ur calculations properly, your annual returns is averaging 13%, that is if you do not reinvest your coupons payment.

Besides, understanding bonds is very complicated with terminologies like dirty price, clean price, yield, coupon rate, par value, years to maturity etc.

If you wont do it and close ur eyes, it is better you stick to the treasury bills which is straight forward.

It's better than NTB for the moment, I just hope interest rate for NTB starts going up soon.

princeuk21:
It's better than NTB for the moment, I just hope interest rate for NTB starts going up soon.

yes oh we must understand it notting is impossible

I don't know why this bond stuff is always confusing to me. I've been worried if its better than TBills.
To get it is always hard. Can someone help with a brief layman's explanations. Thanks in anticipation.
cc: feelamong, unite4real etal

Daddi:
I don't know why this bond stuff is always confusing to me. I've been worried if its better than TBills.
To get it is always hard. Can someone help with a brief layman's explanations. Thanks in anticipation.
cc: feelamong, unite4real etal

Have you made attempt to invest in bond before and couldn't be successful ?

A friend wants an enquiry, so am bringing it to this forum floor to discuss so that i will not give her wrong answers as am yet to get paid my 1st coupon payment which is today, but for the weekend...

If someone wants to invest 3 million naira FGNBond(2020) at the current rate...12%

1) What is the total amount she will use to procure the bond?

2) How much will her 6 monthly coupon be till maturity?

3) Which exact date will she be paid her first coupon interst??

Thanks gurus in the house...

Cc:

Unite4 Real
Feelamong
Coolcash
Meekaboy
Tritri

etc

ukay2:
A friend wants an enquiry, so am bringing it to this forum floor to discuss so that i will not give her wrong answers as am yet to get paid my 1st coupon payment which is today, but for the weekend...

If someone wants to invest 3 million naira FGNBond(2020) at the current rate...12%

1) What is the total amount she will use to procure the bond?

2) How much will her 6 monthly coupon be till maturity?

3) Which exact date will she be paid her first coupon interst??

Thanks gurus in the house...

Cc:

Unite4 Real
Feelamong
Coolcash
Meekaboy
Tritri

etc

1. It depends on some market conditions at time of purchase of the bond such as current yield, years to maturity etc

2. Coupons will be constant every 6 months @(3m x15.54%) /2 = 233k

3. Coupons are paid February and August every year. So if you buy in March, next coupon which will be the first is August.

unite4real:


1. It depends on some market conditions at time of purchase of the bond such as current yield, years to maturity etc

2. Coupons will be constant every 6 months @(3m x15.54%) /2 = 233k

3. Coupons are paid February and August every year. So if you buy in March, next coupon which will be the first is August.

Thanks

So @current yield of 12%, how much will she use to buy the 3m bond?

ukay2:
A friend wants an enquiry, so am bringing it to this forum floor to discuss so that i will not give her wrong answers as am yet to get paid my 1st coupon payment which is today, but for the weekend...
If someone wants to invest 3 million naira FGNBond(2020) at the current rate...12%
1) What is the total amount she will use to procure the bond?
2) How much will her 6 monthly coupon be till maturity?
3) Which exact date will she be paid her first coupon interst??
Thanks gurus in the house...
Cc:
Unite4 Real
Feelamong
Coolcash
Meekaboy
Tritri
etc

1) With 3.3m You should get 3M naira worth of bonds ,2) For The Interest every 6mth at 233k ,3) August .

The Above is valid at 12% yield only. If the yield changes..You need to talk to the Treasury department of your Bank. .

@ukay2 Hope you Get the Point.