Former HSBC investment bankers
Philip Gilbert and Michael Smith have teamed up with Linear Investments Ltd to
launch
BondMart, a portal designed to offer brokers, client advisers and
discretionary managers access to retail bonds from a stable of investment grade
issuers.
Linear is acting as promoter of the bonds and has worked closely
with London Stock Exchange to introduce new investment grade issuers to the
Order Book for Retail Bonds (ORB)
The launch marks an important new
development for the retail bond market with the BondMart platform delivering a
series of new issues from a number of global financial corporations suitable
for retail investors with an issue price at par and initial offer periods of up
to two weeks. Historically, retail investors have had little or no access
to these types of issues and BondMart expects to launch the first inflation-linked
issue in the coming weeks.
“We believe that BondMart will play an important role in helping to grow the overall market for retail
bonds by offering retail investors the diversity and choice normally enjoyed only by institutional investors” –Phillip Gilbert
Philip Gilbert, Linear Investment
said, “This is a breakthrough for retail investors. We believe that BondMart
will play an important role in helping to grow the overall market for retail
bonds by offering retail investors the diversity and choice normally enjoyed
only by institutional investors. The variety of investment grade issues
from global financial
corporations will also enable retail investors to build a diversified portfolio
within this growing asset class. Initially, BondMart will be offering floating
rates issues, a particular initial focus will be on inflation-linked bonds
reflecting the demand shown by retail investors and distributors for these
types of products”.
BondMart has already appointed a
number of Authorised Distributors and brokers and financial advisers will be
able to buy the bonds through this network.
Retail
Bond Expert believes that the opportunity for retail investors to
construct a portfolio of investment grade bonds that is diverse in terms of
both sector and geography represents a step change in the development of this
exciting sector and will report upon developments as BondMart rolls out.
Recent
issues suggest that there is disparity between advised and self-directed
clients in their purchasing patterns; Whereas rating and security
understandably greatly influence the level of uptake by discretionary and
advisory firms, self-directed investors appear much more attuned to the coupon
on offer.
As ever, RBE invites users to sign up and join the debate, and would
particularly like to hear of the appetite from potential investors for
investment grade bonds with the attendant reduction in guaranteed return.
Philip
Gilbert weighs up some of the issues to be considered by the retail investor in
Inflation: The Biggest Threat to Your Bond Portfolio? and would welcome any
inquiries to pgilbert@linearinvestment.com or : +44 (0)
20 3603 9823 Further
details are available at www.linearinvestment.com/linear/bondmart-landing-page