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Share Name Share Symbol Market Type Share ISIN Share Description
M&G Credit Inc. LSE:MGCI London Ordinary Share GB00BFYYL325 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -0.25p -0.24% 103.00p 102.00p 104.00p - - - 112,731 16:35:06
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Equity Investment Instruments - - - - 128.75

M&G Credit Inc. Share Discussion Threads

Chat Pages: 1
yes oversubscribed so may be another placing soon to calm down the premium to nav?
As expected £25m oversubscribed.
Let's take a 10 year investment horizon and a £10k investment. If you invested at 100 this gives (ignoring interest on interest): 10,000+(10,000*.028)+(10,000*.0479*9) = 10,000+280+4,311=14,591 = 4.59% a year If you took up the offer at 101 this gives: 9,901+*(9,901*.028)+(9,901*.0479*9) = 9,901+277+4,268=14,446 = 4.44% a year If you buy at 105: 9,524+(9,524*.028)+(9.524*.0479*9) = 9,524+266+4,109=13,899 = 3.90% a year I appreciate if the base rate goes up so will the returns which you wouldn't get if you bought a fixed rate corporate bond but besides that the figures do nothing to excite me. It's going to have to go back to 100 to get my interest and I suspect that won't happen as demand seems high.
Thanks for summary, Yieldsearch. Gearing to invest in bonds doesn't sound too safe to me! Double charging: it would have to be disclosed in the prospectus.
RNS out a couple of days ago shows people are paying 105.62 for a NAV of 97.94. A premium of 7.85%. Excessive imho
Low market cap, illiquid, no trading hence the price
I really wanted to invest in this but had no spare cash at the time. I suspected it might open at a premium but the current spread of 103.75-105.5 is ridiculous, especially since the prospectus says return for the first year won't be libor+4% but something lower (2.8%? I can't remember exactly and can't be bothered to look up) I suspect at the time of launch bond prices were a bit lower so they may have made a bit there (but not enough to cover the spread) so surely right now the NAV will be below 100p. I'm sure the fund didn't get anything like the funds it wanted at launch so I'm even more surprised to see the share price so high. It seems people are prepared to pay a significant premium for fixed income. I'm not sure such a premium to NAV is warranted. Time will tell.
Thanks for starting this thread. I'm interested, but watching only. Here's David Stevenson in the FT: There is now an investment trust listed on the main London market which offers something close to my ideal. M&G’s Credit Income Investment Trust now trades under the ticker MGCI, having raised £100m. Managed by Jeremy Richards, the fund has a management fee of 0.7 per cent per annum, with an introductory rate of 0.5 per cent until the end of next year. The company has a long-term target dividend of Libor plus 4 per cent. Although still a relatively small fund, and one that operates in a complicated, esoteric market of lending directly to businesses, I am attracted by the fact that it is managed by a world-class institution like M&G. Initially, the fund is likely to have a decent weight in commercial real estate loans, among other types, but it also has the capacity for direct lending, and can invest in leveraged loans, bonds, private placements, structured credit and infrastructure debt. For more adventurous investors looking for an income, I’d be sorely tempted to ditch some of the more esoteric lending funds and focus on a generalist David Stevenson As an investment house, fund manager M&G is well known for its bond market expertise (check out its Bond Vigilantes blog) meaning management are less likely to miss the really big trends in fixed income. The other big positive is the target yield of Libor plus 4 per cent. This feels about right in these increasingly tough markets. Many fund managers operating in private credit markets have much more ambitious yield targets, but these inevitably involve much more risk. Investing in illiquid debt looks attractive from an income point of view until the wider economy suffers, in which case that illiquidity becomes a real problem — you can’t shift the damned loan off your books. So far, the M&G fund is focusing on what are termed investment grade assets (with a rating of at least BBB- or comparable internal rating). This means the yield might be lower but, I would hope, more sustainable in the long term. Many of the loans in its portfolio have some form of floating rate structure built in, which means that if interest rates carry on rising, investors will get a higher return. For more adventurous investors looking for an income, I’d be sorely tempted to ditch some of the more esoteric lending funds and focus on a generalist. Let’s just hope that the fund managers can grow assets beyond the initial £100m before the next downturn comes along and pushes up defaults. Https:// [I see you've linked to an earlier article of his.]
Yield: targeting 3m Libor + 4% Investment criteria: 100+ holdings, >70% Investment Grade Management fee: 0.70% of NAV per year Reference documents hTTps:// hTTp:// GBP 3 month libor hTTps:// hTTps:// !FOLLOWFEED
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