A Great Bond Deal You Will NEVER Get – Guess the Issuer!

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.