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08-02-2012, 11:15 AM
Yea...they probably want to raise the AUM. I am guessing this is why STAM has been hoarding cash in 2011 since it might be bearish ? The funny thing is that it might just continue to purchase 4-5% yielding instruments like the previous rights issue. In that case, the rights issue will be yield negative but it will make the Fund safer ? Is Stam forcing a yield compression ? I was thinking that if STAM just used its $100 mil cash (in Apr 2013) to just buy singtel stock - it would be yield negative, but wouldn't the fund trade at < 8% yield due to arbitrage ? So if GIL keeps buying 'safer' and lower yielding assets, wouldn't there will a yield compression and hence capital appreciation (and performance fees) ? What do you think ?
GIL is currently trading at 15.3 cents with 4.103 million shares traded.
GIL is currently trading at 15.3 cents with 4.103 million shares traded.
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