{"id":22443,"date":"2013-07-09T14:38:24","date_gmt":"2013-07-09T18:38:24","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=22443"},"modified":"2013-07-09T14:38:24","modified_gmt":"2013-07-09T18:38:24","slug":"july-8-2013","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=22443","title":{"rendered":"July 8, 2013"},"content":{"rendered":"

You think you’ve had a bad time in the markets for the past year? Here’s a guy who’s had a bad time in the markets for the past year<\/a>:<\/p>\n

Brazilian billionaire Eike Batista lost more than a quarter of his net worth after the state development bank said he offered personal guarantees for 2.3 billion reais ($1 billion) in loans and a rout of his publicly traded companies deepened.<\/p>\n

Batista is now worth $2.9 billion, down from $4.1 billion at the close of trading July 2, according to the Bloomberg Billionaires Index. The loans are part of the 10.4 billion reais that Batista\u2019s companies contracted with the state-run lender, known as BNDES, since 2007. BNDES provided the tally of the loans and their respective guarantees in response to a request by Bloomberg under Brazil\u2019s freedom of information law. The bank didn\u2019t say how much is outstanding.<\/p>\n

Batista\u2019s fortune has plunged from a peak of $34.5 billion last year after he repeatedly failed to meet targets he had set for his startup companies. The latest disappointment came when his flagship OGX Petroleo & Gas Participacoes SA (OGXP3) said July 1 that it may shut down its only producing oil field, prompting a selloff that\u2019s since erased $1 billion in market value from his six publicly traded units.
…<\/b>
The information provided by BNDES follows a July 1 report from Bank of America Corp. that estimated that the Rio de Janeiro-based lender was the most exposed of Brazil\u2019s banks to Batista\u2019s companies, having lent 4.9 billion reais, or 5.8 percent of the bank\u2019s regulatory capital. <\/p><\/blockquote>\n

The best thing about bond ETFs is that they provide liquidity. The worst thing about them is that they provide liquidity<\/a>:<\/p>\n

Investors who sought exchange-traded funds as a faster way to trade corporate bonds are finding that they can be as expensive to trade as the underlying debt.<\/p>\n

As trading in the three-biggest credit ETFs surged to unprecedented levels last month amid the market\u2019s biggest losses since 2008, the funds\u2019 shares dropped as much as 1.1 percentage points more than the net value of the less-traded securities they hold. The two largest high-yield bond ETFs have lost about 6 percent since reaching a five-year high May 8. That\u2019s about 2 percentage points more than the loss for the Bank of America Merrill Lynch U.S. High Yield Index.<\/p>\n

The gap reflects the extra charge investors paid for a speedier exit in a declining market by using ETFs that trade like stocks rather than buying and selling the less-liquid debt. Investors yanked about $1.83 billion of shares from the two-biggest junk ETFs last month, forcing sales of their holdings at a time when demand was evaporating.
…<\/b>
Shares of BlackRock Inc.\u2019s $13.7 billion iShares iBoxx $ High Yield Corporate Bond ETF, the biggest of its kind, plummeted 4.3 percent in the six days ended June 24, while the net value of its assets dropped 3 percent, data compiled by Bloomberg show. The fund\u2019s share price fell to the lowest level in 12 months on June 24, to $89.04. The lowest value last month for the underlying assets was $89.66, the data show.<\/p>\n

\u201cThe price reflects where you can exchange risk,\u201d said Matt Tucker, head of iShares fixed-income strategy at BlackRock, the biggest ETF provider. \u201cIt\u2019s the correct price. The reality is the majority of the high-yield market doesn\u2019t trade every day.\u201d<\/p><\/blockquote>\n

Nature abhors a vacuum<\/a>:<\/p>\n

Blackstone Group LP (BX), the private-equity firm that has spent $5 billion on more than 30,000 distressed houses, is preparing to expand its bet on the housing recovery by lending to other landlords.<\/p>\n

The firm, which already owns more rental homes than any other investor, has set up B2R Finance LP to offer loans starting at $10 million, according to four people who reviewed the terms. B2R is reaching out to landlords with portfolios of properties seeking to grow in the burgeoning industry for single-family homes to rent, said the people, who asked not to be identified because the discussions are private.<\/p>\n

The world\u2019s largest private-equity firm said last month that it was entering the later stages of its buying spree after leading a group of institutional investors who\u2019ve spent at least $17 billion on more than 100,000 homes over two years, helping fuel the fastest price gains since 2006. By increasing its stake in the rebound through lending, New York-based Blackstone could benefit from smaller landlords already investing in what Goldman Sachs Group Inc. estimates to be a $2.8 trillion market.<\/p><\/blockquote>\n

Live by market-timing, die by market timing<\/a>:<\/p>\n

John Paulson, the billionaire hedge-fund manager seeking to rebound from losses tied to bullion, posted a 23 percent decline in his PFR Gold Fund last month, according to a letter to investors.<\/p>\n

The drop brings losses in the strategy, formerly known as the Paulson Gold Fund, to 65 percent since the start of the year, the firm said in the July 3 letter, a copy of which was obtained by Bloomberg News.<\/p><\/blockquote>\n

This report was delayed due to the incompetence of Toronto Hydro<\/a>.<\/p>\n

It was a day of modest recovery for the Canadian preferred share market; more modest than many recent days, but still a recovery! PerpetualDiscounts and DeemedRetractibles were both up 8bp, while FixedResets won 12bp. Volatility was more than one could generally expect on such a day; volume was average.<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n
HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices<\/strong>
Values are provisional and are finalized monthly<\/td>\n<\/tr>\n
Index<\/td>\nMean
Current
Yield
(at bid)<\/td>\n		Median
YTW<\/td>\n		Median
Average
Trading
Value<\/td>\n		Median
Mod Dur
(YTW)<\/td>\n		Issues<\/td>\nDay’s Perf.<\/td>\nIndex Value<\/td>\n<\/tr>\n
Ratchet<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.3645 %<\/td>\n2,576.3<\/td>\n<\/tr>\n
FixedFloater<\/td>\n4.24 %<\/td>\n3.57 %<\/td>\n43,975<\/td>\n18.12<\/td>\n1<\/td>\n-0.3554 %<\/td>\n3,879.2<\/td>\n<\/tr>\n
Floater<\/td>\n2.72 %<\/td>\n2.90 %<\/td>\n78,760<\/td>\n20.00<\/td>\n4<\/td>\n0.3645 %<\/td>\n2,781.7<\/td>\n<\/tr>\n
OpRet<\/td>\n4.84 %<\/td>\n3.37 %<\/td>\n61,750<\/td>\n0.15<\/td>\n5<\/td>\n0.0156 %<\/td>\n2,619.5<\/td>\n<\/tr>\n
SplitShare<\/td>\n4.66 %<\/td>\n4.28 %<\/td>\n66,464<\/td>\n3.96<\/td>\n6<\/td>\n0.1618 %<\/td>\n2,971.7<\/td>\n<\/tr>\n
Interest-Bearing<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.0156 %<\/td>\n2,395.2<\/td>\n<\/tr>\n
Perpetual-Premium<\/td>\n5.62 %<\/td>\n3.99 %<\/td>\n102,674<\/td>\n0.08<\/td>\n12<\/td>\n0.1306 %<\/td>\n2,281.6<\/td>\n<\/tr>\n
Perpetual-Discount<\/td>\n5.36 %<\/td>\n5.33 %<\/td>\n138,830<\/td>\n14.76<\/td>\n26<\/td>\n0.0849 %<\/td>\n2,404.2<\/td>\n<\/tr>\n
FixedReset<\/td>\n4.95 %<\/td>\n3.41 %<\/td>\n239,169<\/td>\n3.59<\/td>\n83<\/td>\n0.1166 %<\/td>\n2,485.6<\/td>\n<\/tr>\n
Deemed-Retractible<\/td>\n5.05 %<\/td>\n4.49 %<\/td>\n177,810<\/td>\n6.90<\/td>\n44<\/td>\n0.0760 %<\/td>\n2,392.3<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n\n
Performance Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nChange<\/td>\nNotes<\/td>\n<\/tr>\n
CU.PR.E<\/td>\nPerpetual-Discount<\/td>\n-1.19 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2043-07-08
\nMaturity Price : 23.69
\nEvaluated at bid price : 24.04
\nBid-YTW : 5.14 %<\/td>\n<\/tr>\n
HSB.PR.C<\/td>\nDeemed-Retractible<\/td>\n-1.03 %<\/td>\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.98
\nBid-YTW : 5.16 %<\/td>\n<\/tr>\n
SLF.PR.H<\/td>\nFixedReset<\/td>\n1.11 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2016-09-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.57
\nBid-YTW : 3.19 %<\/td>\n<\/tr>\n
GCS.PR.A<\/td>\nSplitShare<\/td>\n1.13 %<\/td>\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2019-07-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.00
\nBid-YTW : 4.01 %<\/td>\n<\/tr>\n
TRP.PR.B<\/td>\nFixedReset<\/td>\n1.21 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2043-07-08
\nMaturity Price : 23.16
\nEvaluated at bid price : 23.50
\nBid-YTW : 3.38 %<\/td>\n<\/tr>\n
FTS.PR.J<\/td>\nPerpetual-Discount<\/td>\n1.25 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2043-07-08
\nMaturity Price : 23.98
\nEvaluated at bid price : 24.35
\nBid-YTW : 4.92 %<\/td>\n<\/tr>\n
PWF.PR.L<\/td>\nPerpetual-Discount<\/td>\n1.37 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2043-07-08
\nMaturity Price : 23.71
\nEvaluated at bid price : 24.05
\nBid-YTW : 5.29 %<\/td>\n<\/tr>\n
BAM.PR.K<\/td>\nFloater<\/td>\n1.48 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2043-07-08
\nMaturity Price : 17.83
\nEvaluated at bid price : 17.83
\nBid-YTW : 2.96 %<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n
Volume Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nShares
Traded<\/td>\n		Notes<\/td>\n<\/tr>\n
BNS.PR.R<\/td>\nFixedReset<\/td>\n59,400<\/td>\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.09
\nBid-YTW : 3.72 %<\/td>\n<\/tr>\n
CM.PR.G<\/td>\nPerpetual-Premium<\/td>\n51,917<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2013-08-07
\nMaturity Price : 25.25
\nEvaluated at bid price : 25.20
\nBid-YTW : 3.88 %<\/td>\n<\/tr>\n
PWF.PR.G<\/td>\nPerpetual-Premium<\/td>\n44,100<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2013-08-07
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.98
\nBid-YTW : 2.36 %<\/td>\n<\/tr>\n
TCA.PR.Y<\/td>\nPerpetual-Discount<\/td>\n43,343<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-03-05
\nMaturity Price : 50.00
\nEvaluated at bid price : 50.01
\nBid-YTW : 5.00 %<\/td>\n<\/tr>\n
TD.PR.S<\/td>\nFixedReset<\/td>\n34,966<\/td>\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.84
\nBid-YTW : 3.54 %<\/td>\n<\/tr>\n
MFC.PR.K<\/td>\nFixedReset<\/td>\n34,400<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2018-09-19
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.01
\nBid-YTW : 3.85 %<\/td>\n<\/tr>\n
There were 34 other index-included issues trading in excess of 10,000 shares.<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n
Wide Spread Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nQuote Data and Yield Notes<\/td>\n<\/tr>\n
ENB.PR.H<\/td>\nFixedReset<\/td>\nQuote: 24.40 – 24.79
\nSpot Rate : 0.3900
\nAverage : 0.2611<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2043-07-08
\nMaturity Price : 22.93
\nEvaluated at bid price : 24.40
\nBid-YTW : 4.00 %<\/td>\n<\/tr>\n

GWO.PR.L<\/td>\nDeemed-Retractible<\/td>\nQuote: 25.40 – 25.79
\nSpot Rate : 0.3900
\nAverage : 0.2721<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2017-12-31
\nMaturity Price : 25.25
\nEvaluated at bid price : 25.40
\nBid-YTW : 5.51 %<\/td>\n<\/tr>\n

CU.PR.C<\/td>\nFixedReset<\/td>\nQuote: 25.72 – 26.09
\nSpot Rate : 0.3700
\nAverage : 0.2688<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2017-06-01
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.72
\nBid-YTW : 3.34 %<\/td>\n<\/tr>\n

MFC.PR.F<\/td>\nFixedReset<\/td>\nQuote: 24.60 – 24.97
\nSpot Rate : 0.3700
\nAverage : 0.2689<\/p>\n

YTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2025-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.60
\nBid-YTW : 3.72 %<\/td>\n<\/tr>\n

CM.PR.K<\/td>\nFixedReset<\/td>\nQuote: 25.58 – 25.90
\nSpot Rate : 0.3200
\nAverage : 0.2267<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-07-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.58
\nBid-YTW : 2.83 %<\/td>\n<\/tr>\n

W.PR.J<\/td>\nPerpetual-Discount<\/td>\nQuote: 24.57 – 24.84
\nSpot Rate : 0.2700
\nAverage : 0.1881<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2043-07-08
\nMaturity Price : 24.27
\nEvaluated at bid price : 24.57
\nBid-YTW : 5.71 %<\/td>\n<\/tr>\n<\/table>\n","protected":false},"excerpt":{"rendered":"

You think you’ve had a bad time in the markets for the past year? Here’s a guy who’s had a bad time in the markets for the past year: Brazilian billionaire Eike Batista lost more …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[],"class_list":["post-22443","post","type-post","status-publish","format-standard","hentry","category-market-action"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/22443","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=22443"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/22443\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=22443"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=22443"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=22443"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}