In my prior post with the title "trust certificate AON Bond KTN", I said I would be looking for an opportunity to add that one and I did a few minutes ago with a 50 shares market order when the ask was 13.10. The coupon is 8.205% with a par at $25. If you cut par in half, that would double your effective yield to 16.41 so my yield would be a tad lower than that. I also placed a limit order at 12.5 for another TC that I have not yet discussed which would double my effective yield above the coupon, a higher tier investment grade issue. My discussion of the Aon TCs are contained in the prior post. I am about to do something a little bit stupid too, maybe I should take a walk first.
In full disclosure, I own shares of KVW and will continue to buy additional shares of other AON TCs at or below the current price, or even slightly above. One of these TCs, KTN, was just purchased at 13.1 I have bought and sold KTN and KVF several times already this year with my last two sales of KTN being a few weeks ago over 20 and both purchases were at higher prices than the purchase today. This is not a recommendation to buy or to sell. Trade at your own risk, and perform research about this security by reading the prospectus at sec.gov and further studying the financial health of AON (symbol AOC at yahoo finance) before making any investment. Consult with your financial advisor prior to making any purchase. In this blog, I am merely describing my reasons for purchasing this security and the potential pitfalls that I identified prior to purchase. This security may not be suitable for others based on their unique financial position and risk profile. THE PROSPECTUS ON THIS TC CAN BE FOUND AT SEC.GOV and the appropriate search term is structured products http://www.sec.gov/edgar/searchedgar/webusers.htm,