Frasers Property (formerly: Frasers Cpt (FCL))

[greengiraffe]

Thanks everyone for pointing out text book theory.

I understand what u guys are pointing out. Unfortunately we are living in extraordinary times and hence at this point where there is abundance of liquidity due to Central Bank interventions, even bonds are deemed risky largely due to pricing.

Hence the perception of being principal guarantee is flawed. Since its risk taking, I would rather assume calculated risks.

3+% for 7 yr to me is deemed too risky. For users of OPM, such rates will be highly affordable as returns on embarking on projects will definitely be much higher than such levels.

GG

GG. If everyone feels the same way you do on Fixed income, we will not have a FI industry.

In a bond... investors are assured that they will be paid back the principal amt (barring bankruptcy) with pinpoint & predictable interest income annually.

As for equity, no investor is sure what the sh price will be nx month or nx year, let alone 7 yrs in this case. No investor can also be sure what the dividend payout will be in the nx 7 years.

** All the above is on the assumption that bond holders will hold to maturity.