Investment Strategy

Exclusive news and research content for FIIG clients.

  • AMP Relative Value - November 2018

    Nov 15, 2018
    AMP’s recent Tier 2 issuance was priced attractively when it launched and remains so as it starts trading in the secondary market. At a spread greater than 3mBBSW+2.30% it offers strong relative value compared to peers, and in our view is an opportunistic buy.
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  • Sprint -- Not slowing down

    Nov 08, 2018
    Following Sprint’s improving 3Q18 results, our independent credit research provider, CreditSights, reaffirmed its Outperform recommendation. With the T-Mobile merger looking more likely, there is further price appreciation likely and presents an opportunistic entry point.
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  • Hybrids – equity like risks, bond like returns

    Nov 08, 2018
    CBA announced a new hybrid last week. While the yield is attractive it’s worth noting hybrids are complex securities and do not offer the same investor protection as bonds. Here we assess the differences.
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  • Model Portfolios - 2 November 2018

    Nov 02, 2018
    We have created three new model portfolios to help clients achieve their risk and return objective. The portfolios offer differing yields and levels of risk, and demonstrate investment options for clients.
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  • HCA Healthy 3Q18 Results - 1 November 2018

    Nov 02, 2018
    Hospital Corporation of America (HCA) reported strong 3Q18 results, beating initial consensus. Our pick is the HCA 2025 bond, which offers a high rated exposure credit and an attractive yield over 4.50%pa.
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  • Barminco Credit Positive Developments and Ratings Upgrade 1 November

    Nov 02, 2018
    In a week of positive news for Barminco the Ausdrill merger was approved, its ratings were upgraded by three notches and its existing contracts were extended. All of these developments have substantially improved Barminco’s credit quality, making this bond a fantastic alpha generating investment option in the current investment environment.
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  • Lend Lease New Issue 1 November 2018

    Nov 02, 2018
    The new 5.5 year and 10 year AUD issuance from Lendlease is expected to meet strong interest from the market. At an indicative yield of 4.35% and 5.20%, respectively, the investment grade bonds offer attractive relative value when compared to peers with similar maturities.
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  • Barminco - Credit Positive Developments - October 2018

    Oct 26, 2018
    In a week of positive news for Barminco the Ausdrill merger was approved and its existing contracts were extended. Both of these have substantially improved Barminco’s credit quality, making this bond a fantastic alpha generating investment option in the current investment environment.
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  • Harvey Trust Series 2018-1

    Oct 25, 2018
    Harvey 2018-1 is Credit Union Australia's (CUA) first transaction for 2018. It is a prime RMBS supported by a good quality pool of collateral.
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  • Firstmac Mortgage Funding Trust No.4 Series 3-2018

    Oct 25, 2018
    Firstmac 2018.3 is the third term out transaction by Firstmac in 2018. It is a prime RMBS transaction supported by a good quality pol of collateral.
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  • Investment Grade USD

    Oct 25, 2018
    Recent volatility in markets had many investors adding more Investment Grade (IG) bonds to their portfolios. Our IG picks in USD are BHP Billiton 2025c, QBE 2026c, Adani Abbott Point Terminal 2022 and NCIG senior 2027. They offer investors exposure to better rated securities without sacrificing yield.
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  • Telco Update - Opportunity Calls

    Oct 22, 2018
    Following a Telco update from our independent credit research provider (ICRP), we have highlighted our recommendations in the sector. Sprint remains a speculative buy in the sector, AT&T a hold, and Frontier and Telstra good exit targets.
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  • Pacific National 2027 - Relative Value in the Floating Rate Space

    Oct 22, 2018
    Australian corporates predominately issue fixed rate bonds. there is therefore a limited offering in the floating rate note (FRN) space, and particularly of investment grade. The pick of those is the Pacific National (formerly Asciano) FRN 2027 bond, which currently we have access to and offers relative value to its peers.
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  • Newcastle Coal (NCIGH) - USD High Yield Investment Option

    Oct 19, 2018
    The NCIGH US dollar bond with 12.50% coupon, currently offers good value, after trading USD8 higher in price earlier this year. The bond is yielding over 8%pa, now presenting an ever more attractive entry price for new investors.
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  • IAMGOLD - USD High Yield investment option

    Oct 12, 2018
    IAMGOLD (IMG) remains our pick in the USD High Yield (HY) mining sector. The current bond price, offering a yield in excess of 6.50%, is a good entry level for new investors or those looking to add to their holdings. Further bolstering this investment thesis are the recent Moody’s upgrade, a rebound in gold price and positive 2Q18 company results.
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  • FIIG Strategy - Hertz - Sector Revision

    Oct 11, 2018
    Our independent credit research provider, CreditSights, has revised its sector recommendations for Car Rental to ‘Selective Risk Taking’. There is no change to the credit and indicatively yielding over 7.90%pa, the Hertz 2022 is an appealing short dated US dollar offering.
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  • Centuria new issue

    Oct 10, 2018
    Centuria Capital No. 2 Fund (Centuria) is launching a new transaction, seeking to raise up to AUD100m of senior secured notes maturing in April 2023. The transaction will include one floating rate tranche and one fixed rate tranche, both offering a yield in the region of 6.50%.
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  • FIIG Strategy – Port Melbourne – New Issuance

    Oct 05, 2018
    Port of Melbourne's inaugural AUD issuance is expected to be in demand due to its investment grade rating as well as the stability and predictability of its cash flows. However, we do not believe it offers value at the indicative pricing of below 4.00%.
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  • FIIG Strategy - BNP Paribas - New Issue Alert

    Oct 05, 2018
    The French Bank, BNP Paribas, is to issue an Australian dollar Tier 2 style bond. The investment grade 15 year bond callable after 10 years is expected to price around 5.00$ yield which equates to a margin of BBSW +2.20%.
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  • FIIG Strategy - Nufarm - New DirectBond

    Oct 05, 2018
    Nufarm's April 2026 bond is the recent inclusion to the DirectBond list and available to wholesale investors. The US dollar bond trades at a discount to its issue price, providing an appealing entry point for investors who are comfortable with the investment grade risk.
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