The Vanguard U.S. Investment Grade Credit Index Fund is a world class fixed income fund.

The Fundamentals of the fund

Number of bonds 6,306
Effective Yield To Maturity 2.9%
Average coupon 3.8%
Average maturity 9.3 years
Average quality A
Average duration 6.5 years
Cash investments 0.6%.

The Fund holds:

AAA 13.6%
AA 11.0%
A 32.8%
BBB 40.6%
Less than BBB 0.0%
Not Rated 2.0%

Total 100%

Assets of the fund:-

Corporate-Industrial 41.4%
Corporate-Financial Institutions 24.3%
Gov-Related-Agency 10.3%
Gov-Related-Sovereign 4.8%
Corporate-Utility 4.8%
Gov-Related-Supranational 4.1%
Securitized-Commercial Mortgage Backed Security 3.7%
Gov-Related-Local Authority 3.0%
Securitized-Asset Backed Security 1.7%
Treasury 1.3%
Cash 0.6%
Securitized-Mortgage Backed Security Pass-through 0.0%
Other 0.0%

Total 100.0%

Legal and General plc is the giant FTSE-100 Life Insurer and Investment Manager.

http://www.legalandgeneral.com

The yield is incredible.

http://www.shareshop.hsbc.co.uk/shareshop/security.cgi?csi=10055&action=

https://www.youtube.com/watch?v=weAUQIZG9xU

The Reserve Bank of India published it latest annual report.

https://www.rbi.org.in/scripts/AnnualReportPublications.aspx

Interesting to see the statistics on Foreign Direct Investment in India.

https://www.rbi.org.in/scripts/AnnualReportPublications.aspx?Id=1221

The United Kingdom in the 6th Largest Investor in India with last year an investment of $1,301m into India.

The table below shows India’s largest investors, $

36,317million.

Yesterday, Fri 22nd Sept 2017, the oil major BP, paid its shareholders its September dividend.

www.bp.com

It was $0.10 a share = 7.6213p a share.

What did that cost BP ?

The total number of voting rights in BP p.l.c. is 19,757,724,586

http://otp.investis.com/clients/uk/bp_plc/rns/regulatory-story.aspx?cid=233&newsid=912897

Thus:-

19,757,724,586 x 7.6213p = £1,505,795,463.87

That is £1,505 Million = £1.505 Billion

http://www.shareshop.hsbc.co.uk/shareshop/security.cgi?username=&ac=&csi=10022&record_search=1&search_phrase=BP

That is a yield of over 6%.

The risks of weak financial regulation

https://www.youtube.com/watch?v=b2q3sdJvNpU

The objective of Aberdeen New Dawn Investment Trust PLC is to provide shareholders
with a high level of capital growth through equity investment in the Asia Pacific
countries excluding Japan.

http://www.newdawn-trust.co.uk/itnewdawn/

Its top ten holdings are:-

Aberdeen Global-Indian EquityC (India) 12.6% of the fund
Samsung Electronics Pref (Korea) 4.8% of the fund
Jardine Strategic (Hong Kong) 4.7% of the fund
Aberdeen Global – China A Share (China) 4.3% of the fund
Oversea-Chinese Banking Corp. (Singapore) 4.1% of the fund
TSMC (Taiwan) 3.6% of the fund
AIA (Hong Kong) 3.4% of the fund
Ayala Land (Philippines) 3.3% of the fund
City Developments (Singapore) 2.9% of the fund
Rio Tinto (Australia) 2.6% of the fund

Total of the top ten make up 46.3% of the fund

Fundamentals:-

Gross assets £332.7m
Debt £29.1m
Cash £1.3m

http://www.shareshop.hsbc.co.uk/shareshop/security.cgi?csi=10651&action=

A yield of 1.7% in a climate of UK interest rates of 0.25%

The 2 Long Term Investors: Asad & Ayana Karim

The Jupiter India Fund is a UK based Unit Trust investing in India and beyond. The Fund aims to achieve long-term capital growth. It will invest primarily in companies which operate or reside in India. It may also invest in companies based in
Pakistan, Sri Lanka and Bangladesh and in companies which derive a significant proportion of business from or within India.

https://www.jupiteram.com/UK/en/Individual-Investors/Our-Funds/Asset-Classes/Equities/Jupiter-India-Fund?sc=GB00B4TZHH95

Top Ten Holdings
Hindustan Petroleum 7.1% of the fund
Godfrey Phillips India 4.3% of the fund
Biocon 3.5% of the fund
State Bank of India 3.1% of the fund
Interglobe Aviation 2.9% of the fund
Reliance Capital 2.5% of the fund
Infosys 2.4% of the fund
Bharat Petroleum 2.4% of the fund
Gillette India 2.2% of the fund
Indian Oil 2.2% of the fund

Total 32.5%

Fund Value: £1,087m

The Royal Sun Alliance Group is a large UK non-life insurer.

http://www.rsagroup.com/

It has a debt programme to help fund its operations

http://www.rsagroup.com/investors/bond-investors/

The outstanding debt that is issued in bonds by RSA Group is:-

Total loan capital £1,254 Million.

This is made up of:-

£5m in Subordinated guaranteed US$ bonds [The rate of interest payable on the bonds is 8.95%]
£359m Perpetual guaranteed subordinated securities [rate of interest payable is 6.701%]
£496m Guaranteed subordinated step-up notes due 2039 [bear interest at a fixed rate of 9.375%]
£394m Guaranteed subordinated notes due 2045 (GBP) [bear a fixed rate of 5.125%]

One can see the debt holders (bond holders) are getting a massive interest rate (coupon) for holding RSA Debt.

The FTSE-All Share is a large Index that represents 639 Companies.

http://www.shareshop.hsbc.co.uk/shareshop/security.cgi?username=&ac=&csi=50100&record_search=1&search_phrase=FTSE All-Share

The 19 sector components that make up the index are:-

Oil & Gas 18 Companies with a market capitalisation of £272,642 Million 11.41% of the index
Chemicals  8 Companies with a market capitalisation of £14,749 Million  0.62% of the index
Basic Resources  22 Companies with a market capitalisation of £167,331 Million  7.00% of the index
Construction & Materials  16 Companies with a market capitalisation of £35,867 Million  1.50% of the index
Industrial Goods & Services  95 Companies with a market capitalisation of £231,185 Million  9.67% of the index
Automobiles & Parts  1 Company with a market capitalisation of £5,467 Million  0.23% of the index
Food & Beverage  15 Companies with a market capitalisation of £91,942 Million  3.85% of the index
Personal & Household Goods  26 Companies with a market capitalisation of £289,646 Million  12.12% of the index
Health Care  22 Companies with a market capitalisation of £202,368 Million  8.47% of the index
Retail 35 Companies with a market capitalisation of £72,998 Million  3.05% of the index
Media  22 Companies with a market capitalisation of £79,443 Million  3.32% of the index
Travel & Leisure  36 Companies with a market capitalisation of £108,052 Million  4.52% of the index
Telecommunications  6 Companies with a market capitalisation of £88,921 Million  3.72% of the index
Utilities  7 Companies with a market capitalisation of £75,035 Million  3.14% of the index
Banks  11 Companies with a market capitalisation of £265,625 Million  11.11% of the index
Insurance  19 Companies with a market capitalisation of £130,918 Million  5.48% of the index
Real Estate  53 Companies with a market capitalisation of £59,442 Million  2.49% of the index
Financial Services  211 Companies with a market capitalisation of £177,522 Million 7.43% of the index
Technology  16 Companies 20  with a market capitalisation of £20,712 Million 0.87% of the index

Totals  639 Companies with the total value of £2,389,866 Million making 100.00% of the index.

That is £2.389 Trillion

https://www.youtube.com/watch?v=7Qo_f7Gzqds

The Junior Oils Trust is a fund that invests in smaller oil companies.

http://www.junioroils.com/

The Fund is managed by Sector Investment Managers Ltd and Marlborough Fund Managers Ltd

https://www.marlboroughfunds.com/

http://www.sectorinvestments.com/

It’s performance since inception has show huge growth and then slump. The investment objective of the Junior Oils Trust is to provide long-term capital growth from a global portfolio of small to medium capitalisation companies specialising in oil exploration and production

http://www.junioroils.com/fund-performance/

Its top ten holdings:-

1. Questerre Energy 11.0% of the fund
2. FAR Ltd 7.1% of the fund
3. Carnarvon Petroleum 5.8% of the fund
4. Africa Oil 5.1% of the fund
5. Ophir Energy 5.0% of the fund
6. Painted Pony 4.9% of the fund
7. Cooper Energy 4.7% of the fund
8. Faroe Petroleum 4.4% of the fund
9. Tamarack Valley 4.4% of the fund
10. Pantheon Resources 4.0% of the fund

This makes up 56.5% of the fund.

The FTSE-250 is the next biggest index on the London Stock Exchange after the FTSE-100. It represents the next 250 largest companies.

http://www.shareshop.hsbc.co.uk/shareshop/security.cgi?csi=50059

The Ticker Symbol is “MCX”

Look at the growth.

From 12,000 points 5 years ago to today, at 19,600

Another month, guess what, take a lucky guess, it is the same old story, HM Government, spends more money than it receives via taxes and duties. Another deficit month, thus to bridge the gap, needs to borrow on the bond market.

In August 2017, the HM Government had to borrow money to meet the difference between tax revenues and public sector expenditure. The term for this is The PSNCR: The Public Sector Net Cash Requirement.

There were “only” 3 auctions of Gilts (UK Government Bonds) by the UK Debt Management Office (http://www.dmo.gov.uk/) to raise cash for HM Treasury:-

23-Aug-2017 0¾% Treasury Gilt 2023 £3,158.6280 Million
08-Aug-2017 0 1/8% Index-linked Treasury Gilt 2026 £1,000.0000 Million
01-Aug-2017 1¼% Treasury Gilt 2027 £2,250.0000 Million

When you add the cash raised:-

∑(£3,158.6280  Million + £1,000.0000  Million + £2,250.0000 Million) =  £6,408.63 Million
Million

£6,408.63 Million  = £6.40863  Billion

On another way of looking at it, is in the 31 days in June, HM Government borrowed:-

£206 million each day for the 31 days.

We are fortunate, while the global banking and financial markets still has the confidence in HM Government to buy the Gilts (Lend money to the UK), the budget deficit keeps rising. What is also alarming, is the dates these bond mature 2023, 2026 and 2027. All long term borrowings, we are mortgaging our futures, but at least “We Are In It Together….”

https://www.youtube.com/watch?v=CHPOhdcOU5o