A New Way to Invest In Goldman Sachs
Goldman Sachs (GS) made news today by issuing $1.3 billion of 50-year bonds with a coupon rate of 6-1/8 %. WSJ article link. The issue was targeted to allow individual investors to participate with a minimum purchase of $25.
Before rushing out to try buy these out on the open market, be aware the bonds are callable after five years. What that means is that if interest rates ramp up over the next few years, investors will be left holding a low-coupon bond for most or the rest of their life or faced with the prospect of selling the bonds at a discount to face value. If rates were to fall below today's ridiculously low rates, Goldman gets to buy the bonds back at face value after five years.
I wasn't able to find a quote on these to find out whether they're trading up or down after issue.
Curious if any Fools bought some of these. If you did, please weigh in with a comment.
Sidebar: In the unlikely event anyone has missed me on the blogs or Fool writing, it's due to the early birthday present I got earlier this month - a brand new Zimmer (ZMH) left hip to replace the arthritic original equipment. I'm about half-way through recovery/rehab and all is going well. I hope to be back to writing and more blogging soon.