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Model Portfolio: 29 April 2009

Portfolio valuations remain fairly steady. We continue to be overweight cash and seeking to invest................

     

The month has seen the value of the majority of our holdings creep upwards as the corporate bond market continues its recovery from the oversold lows seen in November last year. The chart of the M&S 5.625% 2014 (see right) illustrates the strength of this move.   

Structurally, we have a good spread of maturities - "laddered" from the very short Experian July 2009 all the way out to a 2019 maturity in a Tesco bond. At present, we have nothing in the 2017 area, and this is a gap we hope to fill in due course.

Our positions in the PIBS remain a worry. On the positive side, these intruments continue to pay good coupons, but in price terms the Nationwide issue is showing little sign of recovery as yet. Meanwhile, the outcome for the Bradford & Bingley issue remains uncertain, and is largely at the whim of the government.

Looking forward, we remain overweight cash. This is not particulary by choice, but due to a slight hesistance to pay too much for our bonds.

We continue to keep an eye open for bargains. Hopefully a few new issues will wash up on the shores of the Sterling bond market over the summer. We note how well the Roche 5.5% March 2015 has performed and we would welcome the opportunity to "stag" a few more examples like this.     

        

Date of Purchase

Issue

Nominal

Purchase Price

Current Price

Value  

Accrued

30 Jan 2007

Kingfisher 5.625% 15 Dec 2014

10,000

  95.24

 87.1

 8,710

 217

7 Mar 2007

Segro 5.5% 20 June 2018

5,000

  97.35

 66

 3,300

 240

18 April 2007

Merrill Lynch 5.125% 24 Sept 2010

10,000

  97.66

 96.7

 9,670

 313

19 Aug 2007

Portman (Nationwide) 6.25% PIBS

 5,000

  97.50

 80

 4,000

 11

9th Jan 2008

Marks & Spencer 5.625% March 2014

10,000

  95.82

 97.5

 9,750

 64

10th April 2008

Bradford and Bingley 11.625 PIBS

10,000

 112.00

 25

 2,500

 337

23 July 2008

Experian (GUS) 6.375% July 2009

5,000

 98.95

 99

 4,950

 255

20 Aug 2008

Next 5.25% Sept 2013

5,000

 86.5

 95

 4,750

 156

20 Oct 2008

GE Capital 4.75% 15 Jun 2011

5,000

 88.46

 97

 4,850

 33

27 Nov 2008

British Telecom 8% 2016

5,000

 97.5

 103.5

 5,175

 326

18 Feb 2009

Tesco 5.5% Dec 2019

5,000

 103.64

 104

 5,200

 107

26 Feb 2009

Roche 5.5% March 2015

10,000

 99.37

 105

 10,500

 93

26 March 2009

John Lewis 6.375 Jan 2012

5,000

 101.76

 103.9

 5,195  84

 

   
Bond sub total

 

Category Sum            Notes
Securities

78,550

Valuation of current holdings
Accrued

2,236

Interest accrual on above 
Cash

19,416

Including interest & coupons received. 
     
Total

100,202