Debentures and Debt Instrumnets

WildBear · 1 Debentures and Debt Instrumnets Sun Jan 27, 2013 5:45 pm

WildBear

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Is any one interested in investing in corporate bonds. in 2013 budget there are many attractive concessions for bond investors, now they are tax free.This is still an unexplored market in Sri Lanka. If we invest in bonds in high interest environment like these days we'll be able to sell them with larger capital gains in future where low interest rates are likely. Does any one know whether they are tradable through Direct FN. Please let me know and share your experience and views on debt instruments

kukumarx · 2 Re: Debentures and Debt Instrumnets Sun Jan 27, 2013 6:54 pm

kukumarx

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I was interested in the BOC and Sampath Bank Debentures which were issued prior to the 2013 budget (which introduced the tax exemption).

At that point I contacted a few stockbrokers and all of them said they did not have the platform to trade in debt. They said that I could use my CDS account with them to buy the debt but I would have to hold it to maturity. Apparently that platform costs quite a bit and there are extra fees payable to the exchange to trade in debt. So post Vanik, most of them had given up on trading debt.

The picture has now changed. The tax exemption makes debt attractive so they have to get their platform going again. I will contact the broker I deal with (CTS) and get back with the results. Perhaps other readers could do the same.

niru · 3 Re: Debentures and Debt Instrumnets Sun Jan 27, 2013 7:25 pm

niru

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Hi, Good news is that you can trade debt instruments from Feb 8th, 2013 through Internet trading system.
CSE wish to go live with debt instruments and most of the brokers are ready for that. (JBS told me)

You can trade Treasury Bills, Treasury Bonds and Corporate Bonds (Debentures)

WildBear · 4 Re: Debentures and Debt Instrumnets Sun Jan 27, 2013 8:43 pm

WildBear

Assistant Vice President - Equity Analytics

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@ Kukumarx and niru- Thanks for the info. I think bond trading is going to be interesting than ever in coming years if we buy some high yield debt in these days. Interest rates are on verge of declining trend. This reminds me how CFVF earned massive profits in 2010 from bond trading. So that I'd like to buy some bonds and CFVF in coming months. Very Happy