As I mentioned in “7 Newly Issued Bonds You Might Have Missed,” there were numerous corporate notes newly issued over the past few weeks. Several of these notes, which can now be found trading in the secondary market, are listed below. Each of the following seven corporate notes has investment grade ratings from Moody’s and S&P, maturities ranging from five to thirty years, yields ranging from 1.683% to 5.293%, and the spread to Treasuries ranging from 95.1 to 345.1 basis points.
HCP Inc.’s (HCP) senior unsecured note (CUSIP: 40414LAF6) maturing 2/1/2019 has a coupon of 3.75% and is asking 100.769 cents on the dollar (3.622% yield-to-call before commissions). It pays interest semi-annually, has a make whole call until 12/1/2018, and is thereafter callable at par. Moody’s currently rates the note Baa2; S&P rates it BBB. It was originally offered at a price of 99.523, and the offer size was $450 million. The offer date was January 18, 2012. Currently, the 1/31/2019 U.S. Treasury note (CUSIP: 912828SD3) is yielding 1.273%, which means HCP’s note is asking 234.9 basis points more than a corresponding Treasury note.
If you are interested in purchasing any of these securities but are nervous about counterparty risk wreaking havoc on your portfolio, learn how to hedge individual bonds in, “Protect Your Income Portfolio With Cross-Asset Hedging.”
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