So this crosses my desk the other day. It is going to benefit someone…. But who? It appears that the one who will benefit will be the seller as there is a step rate and it is callable anytime after issue.
More importantly, notice that the teaser is for the 7% that no one will ever receive as the probability is high that it will be called well before it pays that rate.
Goldman Sachs Note Step-ups 8.5nc6mos 8/24/18
Cusip 38143UGG0 Rating: A1/A
- 4.00% for 4.5yrs (2/24/10 – 8/24/14)
- 5.00% for 2.0yrs (8/24/14 – 8/24/16) IRR @ Par = 4.82%
- 7.00% for 2.0yrs (8/24/16 – 8/24/18)
Settles 2/24/10 Qtly Pay * Call 8/24/10 Qtly Call *No Deathput*
Disclosure: Horowitz & Company clients may hold positions of securities mentioned as of the date published.