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Model Portfolio: 12 March 2013

Some profit taking and two new issues added....

    

With a number of new issues on the horizon, we are making some adjustments to the Model Portfolio.

First, we are taking profits in the following:

  1. Yorkshire Building Society 13.5%, which has a nice rally to 144.
  2. Enterprise Inns, which we have covered in the bond blog as well as Bond of the week, was also taken off the list as prices advances back to par. We originally bought at 83.
  3. Ecclesiastical 8.625% prefs was taken off the Portfolio following a 10-point run since November.

Next, we add a couple of new issues to the portfolio. Specifically, we bought the Enquest 5.5% and Paragon 6% bonds, for £10k each. (You can read the respective Bond of the Week on Paragon and Enquest here.) Both bonds are trading around 2% above listing price.

The new retail bond issues are trading generally steady and we hope to add more new issues over the next few months.

Moving to the rest of the Portfolio, we note no dramatic risers this month, but steady gains from National Grid, Places for People and Italy, gaining between 3% and 4.5% since the last write up.

On the downside, we see a small decline in the price of ICAP 5.5% and Tesco, but each under 1%.

Overall, the portfolio remains generally strong with a NLV increase to £151,557.  We retain £57,305.54 in cash for future purchases.

Note: The portfolio is operated with real money initial deposit of £100,000 and traded through our live bond account. This is to accurately reflect the performance and holds a mixture of credits and bond types, from the AA-rated Places for People bond, down to more speculative holdings such as the BB- rated Enterprise Inns bond. The Portfolio also has a small proportion of its holdings in fixed income preference shares and "bond-like" instruments. Fixed Income ETFs may be added from time to time.

Purchase Date Issue Life (yrs)  Nominal Purchase Price Current Price Current Value Accrued Interest
24.3.11 Provident Financial 7.5% 2016 4         6,000 100.15 107.15 6399 205.22
31.7.12 ICAP 5.5% July 2018 6         5,000 100 102.93 5174 32.67
3.9.12 CLS HLDGS 5.5% BDS 2019 7       12,000 101.3 101.65 11862 134.92
10.10.12 Workspace 6% Sept 2019 7         5,000 100 104.9 5097 129.4
16.5.12 Tesco Bank 5% 2020 8         5,000 100 106.5 5335 78.73
20.9.12 ICG 6.25 Sept 2020 8       12,000 100 102.93 12294 366.71
13.10.11 National Grid PLC 1.25 2021 9       10,000 100 110.88 10762 57.71
31.1.10 Places for People 1% RPI 2022 10         6,000 100 106.18 6156 7.44
8.3.11 Italy 6% 2028 16         5,000 100.44 103.542 4955 184.17
8.3.12 Nationwide 6.875% U/D         5,000 88 99 4900 60.77
15.2.13 Enquest 5.5% 2022 9       10,000 100 101.63 10000 42.54
5.3.13 Paragon 6% 2020 7       10,000 100 102 10000 £16.30

Category Sum            Notes
Securities £92,935 Valuation of current holdings
Accrued £1,317 Interest accrual on above 
Cash £57,305.54 Inc. interest & coupons received. 
Total £151,557

You are welcome to discuss our portfolio in the fixed income forum.