Gen.acc.8se.pf Discussion Threads

[nerja] 27/5/2022 09:40

CC2104 mmmm good points.

[cc2014] 27/5/2022 09:26

My guess is that there are a large number of PI's in this type of stock and they have been taken a bit by surprise by the falls. We have seen alot of posts in the past about posters not being worried about capital losses as long as they get the income.

That is fine until people start looking a bit harder at the recent returns and realising that their money would have been better off in the bank earning interest.

It would also be my guess that people are going to be taken by surprise by how many interest rate rises are going to be required to tame inflation.

I don't know where the bottom is. I have no idea. I'd be alot more comfortable buying say a year down the line when future interest rate projections become clear.

[nerja] 26/5/2022 17:36

Looking at the past, it dropped to the 115 ish area in 2020, in 2001 and 2003 the same area ish, i ask myself are we in more sh@t now than then, I think we are but not a clue really, the markets going up when they have no idea if inflation is going to have second round effects from wage rises is beyond me. It seems just like the seventies to me when the discontent grew to massive disruption ,strikes etc.
The governments dish out today is going to do only a small amount to the bills people are facing so I can only see recession .
These are getting so tempting though.

[my retirement fund] 26/5/2022 16:54

Yup like you say may weaken further if big seller out there but if does I'll have to start selling the family silver for more now

[cwa1] 26/5/2022 16:16

At almost 7% allowing for accrued, as mrf suggests, it does look a little bit tempting. Possibly lower yet to come-but I've decided to take a handful at 132p using up the dividend cash I had in one of my accounts. Been a long time since I had some of these :-)

[my retirement fund] 26/5/2022 15:26

Have to disagree with your calculations but if GACA = 133 to buy after dealing cost it would be sensible to deduct 4.438 as in effect that's accrued, so 128.56p

9.875/128.56*100= 6.9%

as such I just added small lots to my fixed income portfolio for the long term.

[makinbuks] 26/5/2022 15:13

In the past as rates fell I made good money on GACA whilst collecting the interest payments. Now, I like the 6.5% yield which seems attractive compared to 10 year gilts at 1.9% but fear what they will give up on further interest rate rises

[skyship] 26/5/2022 14:22

Yields at offer prices:

# AV.A 8.75% @ 132.0p-133.2p = 6.57%
# AV.B 8.375% @ 126.5p-127.5p = 6.57%
# GACA 8.875% @ 132.0p-133.0p = 6.67%
# GACB 7.875% @ 118.0p-120.7p = 6.52%

So, 6.5%+ on all of them now...

AV.A & GACA both go XD on 1st June.

[nerja] 26/5/2022 14:21

Thanks guys

[my retirement fund] 26/5/2022 12:22

I think they just want to work out the yeild when you buy, so you take your average shareprice after costs, lets say 135 on a 8.875% pref

so its 8.875/135 * 100

that would be giving you a 6.574% return

[jonwig] 25/5/2022 20:13

nerja, you could do the sum like this:

Price = 100 * (8.875/Yield)

where Yield is the one you want (6.5, etc.) and Price is the share price that gives it.

[Sorry to butt in, Skyship.]

[nerja] 25/5/2022 19:41

Big request skyship if you are about what prices for these prefs do they fall to get
6.5%
6.75%
7.00%
Forward is forarmed tia

[skyship] 14/2/2022 16:18

Yields at offer prices:

# AV.A 8.75% @ 142.0p-143.3p = 6.11%
# AV.B 8.375% @ 139.0p-139.6p = 6.00%
# GACA 8.875% @ 138.1p-139.2p = 6.38%
# GACB 7.875% @ 126.1p-126.7p = 6.22%

6%+ on all of them now...

[makinbuks] 09/2/2022 09:17

Goldman Sachs now predicting 5 US rate hikes this year from the consensus 4

[boystown] 08/2/2022 20:19

Looks good for income seekers to me. Inflation would have to far exceed current forecasts for this to become an issue????

[makinbuks] 08/2/2022 19:12

Thankfully got out of GACA at £1.49, purchased in Sept 2012 for £1.0725. Might we see that level again?

[andyj] 08/2/2022 13:25

Interesting to see how far they drop. Watching closely

[skyship] 08/2/2022 13:11

Yields at offer prices:

# AV.A 8.75% @ 144.3p-145.8p = 6.00%
# AV.B 8.375% @ 139.0p-140.5p = 5.96%
# GACA 8.875% @ 139.8p-142.9p = 6.21%
# GACB 7.875% @ 128.0p-128.7p = 6.12%

Quite sharp falls across the piece...2%-5% in just two weeks.

[skyship] 26/1/2022 15:25

Yields at offer prices:

# AV.A 8.75% @ 152.0p-154.0p = 5.68%
# AV.B 8.375% @ 145.0p-147.0p = 5.70%
# GACA 8.875% @ 145.0p-146.0p = 6.08%
# GACB 7.875% @ 130.3p-131.9p = 5.97%

The Aviva prefs have been rather quiet over the past 2months. As usual the General Accident duo look the best value, with IMO the laurels going to GACB as they are the next to go XD (March).

There has been much debate as to whether the irredeemables might be vulnerable to rising interest rates. Also whether central banks could actually release interest rates to rise when global indebtedness would mean an unbearable hit to GDPs!

In previous cycles, allowing inflation to erode debt worked; this time it all looks rather different...so these yields might prove acceptable.

[skinny] 04/1/2022 10:54

Unless anyone has a better link, this is a basic replacement for the link in the header :-

[makinbuks] 26/11/2021 08:24

Correct me if I am wrong but the company has announced a debt reduction program and minimum amount it will return to shareholders by the middle of next year. It hasn't said how the return to shareholders will be made nor which debt it is going to redeem although in both cases the process ha started and you can see a direction of travel. Alongside that we know the company would like to retire GACA from the earlier fiasco so it would be very strange indeed if they didn't consider it as an option again now. I would also point out that the CEO is focused on simplifying the group which you could also argue points to dropping the prefs. Of course if you have to pay the market price or even a premium to cancel them that is a financially neutral transaction at best unless the market is mispricing them

[kenny] 25/11/2021 11:15

makinbuks - not true. Look at the announcements from Aviva.

[makinbuks] 24/11/2021 18:41

AV hasn't said anything about how they are going to distribute the cash other than give a value they expect to complete by Q2 next year. Debt reduction as a portion of it is very much on the cards.

[kenny] 24/11/2021 11:58

It does not appear so, as those funds are fully allocated elsewhere.

[skyship] 03/11/2021 09:06

Rapid change in sentiment, especially as regards the lead pref - AV.A - which at one stage was down to an offer price of 143p!

Yields at offer prices:

# AV.A 8.75% @ 152.25p-156.0p = 5.61%
# AV.B 8.375% @ 145.0p-150.0p = 5.58%
# GACA 8.875% @ 149.0p-152.0p = 5.84%
# GACB 7.875% @ 132.3p-134.0p = 5.88%