Stobart group have a new Bond on sale -6 year,fixed 5.5% pa. Min.£2k. I think the offer expires Nov.29th 2012 latest. This is a genuine question -I’m not a lover or hater of ESL, just wondering if anyone has any constructive thoughts.
dailymail.co.uk/money/invest … -bond.html
I refer the honourable gentleman to the reply I gave earlier. 
Winseer:
Stobart Group launches six-year 5.5% retail bond | Daily Mail OnlineI refer the honourable gentleman to the reply I gave earlier.
Apologies,Winseer.I missed that thread completely 
If I can find a sword,I shall immediately fall on it.Either that or pay more attention. 
I think this is a bit of clever marketing by Stobart, whatever you think of them they are very good at marketing themselves. It might not be the best investment in the World, but they have a loyal fan base who’ll buy anything Stobart related so why not get them to invest in the company.
5.5% is not a bad rate, better than any bank will give you… although your money is safe in a bank- they are NOT safe in bonds…
The thinking is that this will be oversubscribed with a lot of funds trying to buy these up- so as a short term investment it may be worthwhile buying them at face value and doing a quick sell on. but to make decent money at doing that beating the 5.5% you would need a significant investment the 2K minimum is not going to give you much back, - and the wallet is looking a bit empty atm so I am out 
I also saw the offer…invest in transport…invest in Stobarts…just popping out to do the Lottery.
There are some better % bonds around atm, with similar risks & £s investment I regularly receive invites from certain leading banks with offers of bonds of 8%+ (10% for 5yr+ investments) Have I bothered taking up their offers? ..........................no, atm Id rather take the less risky option of spending it on beer & wimmin`
Peirre
You could also just waste it!!
sounds like the bank won’t lend them any money, but the fans will.
I regularly receive invites from certain leading banks with offers of bonds of 8%+ (10% for 5yr+ investments
Which banks?
I have struggled to find anything over 5.5% , except for two Indian banks.
better than any bank will give you… although your money is safe in a bank- they are NOT safe in bonds…
Fixed rate bonds from a bank etc are as safe as any other savings.AFAIK
I’ve put money in transport company shares before and done ok, but this deal with bonds seems too risky for a mediocre return.
del949:
I regularly receive invites from certain leading banks with offers of bonds of 8%+ (10% for 5yr+ investments
Which banks?
I have struggled to find anything over 5.5% , except for two Indian banks.better than any bank will give you… although your money is safe in a bank- they are NOT safe in bonds…
Fixed rate bonds from a bank etc are as safe as any other savings.AFAIK
Not bonds, but afaik if you have money in a savings account your money is guaranteed by government if the bank goes bust, but of course you don’t get anywhere near the same return.
Six years is a long time and a lot can happen to interest rates in that time.
So the only way you can loose your money is if stobarts go bust?
2k invested over 6 years you’d get 660quid in profit back. But 6 years is a long time isnt it usually like 2 years for bonds?
Up unitl 2009 banks where giving 5% on savings accounts, look at 1990 14.23% will we ever see those days again 
Stobart are assuming that towards the end of the term, 5.5% will be less than they would pay to borrow the money from their bank. As has been said, six years is a long time and anything could happen to interest rates in that time, particularly if the USA, which is nearer to recession end, raises their base rate to more normal levels which will give us no choice but to follow them.
And of course, as has also been pointed out, if Stobart were to go bust then the money is lost.
i’ll give you 50% return on bonds bought from me.
just give me £2000 each, and i’ll sort you out a few quid in six years.
honest.
All it needs is Tesco to pull the contract from Stobarts and offer it to Norbert’s or DHL et al , the share price takes a bath and your money gone. The only companies i would invest in would be Microsoft or Apple, transport companies not a chance.
merc0447:
So the only way you can loose your money is if stobarts go bust?2k invested over 6 years you’d get 660quid in profit back. But 6 years is a long time isnt it usually like 2 years for bonds?
Up unitl 2009 banks where giving 5% on savings accounts, look at 1990 14.23% will we ever see those days again
No, Stobarts can funnel all their money into a holding company that is beyond the bonds scope, and then declare the wing that the bonds are based on go under with the result of getting out of paying back those bonds. This scenario would most likely occur IF interest rates stay at current or lower levels for the entire period of the bond (likely IMO) AND Stobarts fall victim to a totally new approach to transport made by one of their competitors - Maybe not so likely, but everyone forgets the biggest economy in the world will be China by 2016, so I’d be looking more in the direction of the red and white firm. 
Such a similar thing has just happened with the venture firm that took over Comets for a couple of quid, and have now run off with all the money (£50m+ I believe) whilst leaving Comets itself in ruins, and customers who’ve already paid for goods & services in advance defaulted upon.
Not bonds, but afaik if you have money in a savings account your money is guaranteed by government if the bank goes bust, but of course you don’t get anywhere near the same return
As I understand it, my bonds, bought through the bank are covered by the same FSA guarantees .
Still waiting for Peirre to tell us where I can get 8% plus, 'cos I’ll have some of that 
FSA guarantees are upon the underwriters of bonds not the issuing company itself.
Think about it. If a bust firm could be made to pay back money in full to investors via FSA rules, then no one would ever lose any money on the bond markets ever!
Investment banks such as Goldman Sachs might issue bonds on behalf of a client firm, taking a huge fee as their “loan to value fee” or “indemnity” or “underwriting” fee if you like, which in turn represents sufficient compensation to buy up the rump of any unsold bonds during the original issue, and lay off FSA liabilities (in the event of client company default) via the credit default swap derivatives market. This would spread any compensation owed to clients losing their shirts so far and thin that they’d never get near to 100p in the pound which is pretty much what you’d need from a bond that only pays 5.5%. Even a return of 90p in the pound means that over the 6 year period, not only has 10% of the investment been lost, but fiscal drag adds the cost of inflation and the cost of carry on top, making the total loss in real terms a lot higher. THIS type of insidious loss by stealth is the kind most overlooked by investors not in the know everywhere.
In the event of an issuing company going ■■■■ up, any money raised from sale of remaining residue stock and property (less commissions and other secured overhead payments) would result in a certain p in the pound return that is always more than what shareholders get, those shareholders in turn frequently getting zero.
What’s wrong with company law these days is that debts can be passed around from one subsidary company to another, with no flow back the other way when one firm is thus depleted of funds. Indeed, company A worth £100m in theory can buy a roll of toilet paper from Subsidary B for £99m which would then leave A likely to go bankrupt (“All the money went missing”) whilst company B with possibly only one customer - Company A 
- then makes £99m apparently out of thin air. Company A of course will not own any property or other actual realisable assets, but it frequently WILL owe stacks of money in wages, supplier debts, and investment monies.
The solution is to clear the channels between subsidary firms so that one firm in a chain owned by the same parent going bust MUST be bailed out by other wings of the company. I don’t think the law will ever be passed that allows bondholders to strip assets from the private wealth of directors as a result of the Ltd protections. 
Company law today is little more than a fraudster’s charter. In the future, people will find a small firm they can walk down the road and actually visit has a better reputation than any large firm that can disappear overnight, or indeed might never have “really” existed in the real physical world in the first place. 