NBI are offering a 3 for 4 Entitlement offer at $2.05 per unit.
What is your view ?
A: I am a reasonable fan of these products and am an investor in the NB Global Corporate Income Trust (NBI). I consider them as part of the “risky fixed interest” component of my portfolio.
Critically, they do invest in non-investment grade corporate bonds. Further, while this is a very well diversified trust (comprising more than 300 individual bonds) and a great manager in Neuberger Berman, manager diversification may also be a consideration.
In regard to the particular offer (a 3 for 4 entitlement);
- It is at an offer price of $2.05 per unit. The last quoted NTA is $2.05 per unit;
- This year’s target distribution is 5.25% pa, paid monthly. This is likely to fall in 20/21 to around 4.75%; and
- The offer closes on February 21.
