Comments on: This and That: The cost of thrift, market recovery and more… http://www.canadiancapitalist.com/this-and-that-the-cost-of-thrift-market-recovery-and-more/ Helping you invest and prosper Sun, 12 Feb 2012 00:54:40 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: MoneyEnergy http://www.canadiancapitalist.com/this-and-that-the-cost-of-thrift-market-recovery-and-more/#comment-192573 MoneyEnergy Sat, 30 May 2009 04:51:25 +0000 http://www.canadiancapitalist.com/?p=2463#comment-192573 Man I am tired of all these content thiefs. I really doubt this is a site you run on the side, but much of your site and this whole article has been copied and reproduced here: http://www.moneyvsdebt.com/2009/05/29/this-and-that-the-cost-of-thrift-market-recovery-and-more%E2%80%A6/comment-page-1/#comment-30388 Another article of mine was ripped off today by adviceworld.info. Man I am tired of all these content thiefs. I really doubt this is a site you run on the side, but much of your site and this whole article has been copied and reproduced here: http://www.moneyvsdebt.com/2009/05/29/this-and-that-the-cost-of-thrift-market-recovery-and-more%E2%80%A6/comment-page-1/#comment-30388

Another article of mine was ripped off today by adviceworld.info.

]]> By: Robillard http://www.canadiancapitalist.com/this-and-that-the-cost-of-thrift-market-recovery-and-more/#comment-192559 Robillard Fri, 29 May 2009 22:57:35 +0000 http://www.canadiancapitalist.com/?p=2463#comment-192559 Phil S Sorry, I stand corrected. I was making a sweeping generalisation. Phil S
Sorry, I stand corrected. I was making a sweeping generalisation.

]]> By: WhereDoesAllMyMoneyGo.com http://www.canadiancapitalist.com/this-and-that-the-cost-of-thrift-market-recovery-and-more/#comment-192558 WhereDoesAllMyMoneyGo.com Fri, 29 May 2009 22:40:44 +0000 http://www.canadiancapitalist.com/?p=2463#comment-192558 The brokers who publish the bid/asks are only publishing THEIR bid/asks that they are offering to the retail client. Also, note that some fixed income desks are set up as profit centres and some are not. The brokers who publish the bid/asks are only publishing THEIR bid/asks that they are offering to the retail client. Also, note that some fixed income desks are set up as profit centres and some are not.

]]> By: Canadian Capitalist http://www.canadiancapitalist.com/this-and-that-the-cost-of-thrift-market-recovery-and-more/#comment-192557 Canadian Capitalist Fri, 29 May 2009 21:54:36 +0000 http://www.canadiancapitalist.com/?p=2463#comment-192557 Phil S: I don't buy bonds but I thought some brokers publish the Buy/Sell price for the same bond -- it is easy to see the spread from that. Bonds make up just 20% of my portfolio, so it has been pretty easy so far. I simply hold XSB, though a ladder of GICs as proxy for part of the bond holdings is in the works. I find GICs to be a good deal. Giving up liquidity and getting a small boost in yield is an interesting trade-off. Phil S: I don’t buy bonds but I thought some brokers publish the Buy/Sell price for the same bond — it is easy to see the spread from that. Bonds make up just 20% of my portfolio, so it has been pretty easy so far. I simply hold XSB, though a ladder of GICs as proxy for part of the bond holdings is in the works.

I find GICs to be a good deal. Giving up liquidity and getting a small boost in yield is an interesting trade-off.

]]> By: Phil S http://www.canadiancapitalist.com/this-and-that-the-cost-of-thrift-market-recovery-and-more/#comment-192555 Phil S Fri, 29 May 2009 21:49:02 +0000 http://www.canadiancapitalist.com/?p=2463#comment-192555 @Robillard. In the absence of a true open bond trading market, the income trust structure was the "closest" thing that we had to that... While you are accurate in MOST cases that income trusts are equities, there were /are many cases where income trust structures held debt. Canada Trust used to have an IT holding fixed income products (CT.UN) but it's already been taken private and de-listed, but I currently still hold FC.UN which is an IT that only holds mortgage debt. So, not all income trusts were equities, although most of them are / were... H&R converted to some kind of strange structure where you have a REIT unit with a debt note "stapled" to it - all because of the Government's rule changes. So, if you buy an H&R unit, you are buying both equity & debt. I don't know every example where an income trust is structured around debt, but those are the ones that I currently own or owned at one point in time. @Robillard. In the absence of a true open bond trading market, the income trust structure was the “closest” thing that we had to that… While you are accurate in MOST cases that income trusts are equities, there were /are many cases where income trust structures held debt. Canada Trust used to have an IT holding fixed income products (CT.UN) but it’s already been taken private and de-listed, but I currently still hold FC.UN which is an IT that only holds mortgage debt. So, not all income trusts were equities, although most of them are / were… H&R converted to some kind of strange structure where you have a REIT unit with a debt note “stapled” to it – all because of the Government’s rule changes. So, if you buy an H&R unit, you are buying both equity & debt. I don’t know every example where an income trust is structured around debt, but those are the ones that I currently own or owned at one point in time.

]]> By: Robillard http://www.canadiancapitalist.com/this-and-that-the-cost-of-thrift-market-recovery-and-more/#comment-192551 Robillard Fri, 29 May 2009 19:47:58 +0000 http://www.canadiancapitalist.com/?p=2463#comment-192551 Thanks for linking the discussion thread in the forum. Phil S - Income trusts are a lot different from bonds. They are basically equity, and will only pay out when the company the trust holds makes money. Companies are obligated to make interest payments on bonds even when losing money. I agree that it would be nice if bonds were traded on a public exchange instead of over-the-counter. I'm not sure it would work well though because there are many more bond issues than there are stock issues. Also, in an exchange environment, you need to have market makers/specialists with lots of limit orders. Bonds are not as liquid as stocks because they don't get traded as much and because there are not many discrete bundles of a bond issue outstanding. If the minimum bond holding is $5000 of face value, and a there is $500 million in face value worth of that bond issue outstanding, then you can think of there really only being up to 100,000 discrete bundles of the bond issue on the market. By comparison, shares are issued in the millions or billions, so there are a lot more shares available to be traded, even if only a fraction of them are traded in a single day. Thanks for linking the discussion thread in the forum.

Phil S – Income trusts are a lot different from bonds. They are basically equity, and will only pay out when the company the trust holds makes money. Companies are obligated to make interest payments on bonds even when losing money.

I agree that it would be nice if bonds were traded on a public exchange instead of over-the-counter. I’m not sure it would work well though because there are many more bond issues than there are stock issues. Also, in an exchange environment, you need to have market makers/specialists with lots of limit orders. Bonds are not as liquid as stocks because they don’t get traded as much and because there are not many discrete bundles of a bond issue outstanding. If the minimum bond holding is $5000 of face value, and a there is $500 million in face value worth of that bond issue outstanding, then you can think of there really only being up to 100,000 discrete bundles of the bond issue on the market. By comparison, shares are issued in the millions or billions, so there are a lot more shares available to be traded, even if only a fraction of them are traded in a single day.

]]> By: Four Pillars http://www.canadiancapitalist.com/this-and-that-the-cost-of-thrift-market-recovery-and-more/#comment-192544 Four Pillars Fri, 29 May 2009 18:44:33 +0000 http://www.canadiancapitalist.com/?p=2463#comment-192544 Thanks for the mention. Thanks for the mention.

]]> By: MoneyEnergy http://www.canadiancapitalist.com/this-and-that-the-cost-of-thrift-market-recovery-and-more/#comment-192541 MoneyEnergy Fri, 29 May 2009 17:25:22 +0000 http://www.canadiancapitalist.com/?p=2463#comment-192541 Nice round up, thanks for sharing my article. I agree with Phil's comment above. It's easy enough to buy government bonds, but I'm not sure how to go the corporate or municipal route other than through ETFs and funds. Compared to the US at least, us Canadians have a lot of "baked in" fees everywhere - trading commissions alone are abominable compared to the offerings a la Zecco et al. Nice round up, thanks for sharing my article. I agree with Phil’s comment above. It’s easy enough to buy government bonds, but I’m not sure how to go the corporate or municipal route other than through ETFs and funds. Compared to the US at least, us Canadians have a lot of “baked in” fees everywhere – trading commissions alone are abominable compared to the offerings a la Zecco et al.

]]> By: Phil S http://www.canadiancapitalist.com/this-and-that-the-cost-of-thrift-market-recovery-and-more/#comment-192537 Phil S Fri, 29 May 2009 16:39:56 +0000 http://www.canadiancapitalist.com/?p=2463#comment-192537 It looks like many of the posters on the bond thread of the Canadian Money Forum have exactly the same concerns as I have... That there is no fully transparent, publicly accessible bond trading market in Canada. The closest thing that we HAD was the burgeoning Income Trust market which our Government in their infinite wisdom has decided to completely blow-up!!! In my opinion, the ideal situation would be to have an exchange which lists the bid / ask for all sorts of bonds - corporate, government and agency bonds. Then the discount brokers would offer a fixed trading fee just like they have for stocks and we as individuals would know exactly how much commission we are paying for those bonds. The current system of trading only with your broker's bond trading desk and their system of "baked-in" commissions only serves to rip us (the small investors) off!!! I find this to be such an outrage!!! But often times, I feel like maybe I am the ONLY small investor in Canada who is buying bonds, so that's why I figured that my complaints always fall on deaf ears. It is good to see on Canadian Money Forum that I am at least not the only person who feels this way!!! There are maybe 4 or 5 of us!!! :) It looks like many of the posters on the bond thread of the Canadian Money Forum have exactly the same concerns as I have… That there is no fully transparent, publicly accessible bond trading market in Canada. The closest thing that we HAD was the burgeoning Income Trust market which our Government in their infinite wisdom has decided to completely blow-up!!!

In my opinion, the ideal situation would be to have an exchange which lists the bid / ask for all sorts of bonds – corporate, government and agency bonds. Then the discount brokers would offer a fixed trading fee just like they have for stocks and we as individuals would know exactly how much commission we are paying for those bonds. The current system of trading only with your broker’s bond trading desk and their system of “baked-in” commissions only serves to rip us (the small investors) off!!!

I find this to be such an outrage!!! But often times, I feel like maybe I am the ONLY small investor in Canada who is buying bonds, so that’s why I figured that my complaints always fall on deaf ears. It is good to see on Canadian Money Forum that I am at least not the only person who feels this way!!! There are maybe 4 or 5 of us!!! :)

]]> By: MDJ http://www.canadiancapitalist.com/this-and-that-the-cost-of-thrift-market-recovery-and-more/#comment-192535 MDJ Fri, 29 May 2009 15:58:18 +0000 http://www.canadiancapitalist.com/?p=2463#comment-192535 Thanks for the link Ram! Thanks for the link Ram!

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