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May 10, 2016 at 12:34 pm
Brilliant lecture, really makes traded debt clear to understand, right from what happens when the company first advertises.
John Moffat says
May 10, 2016 at 4:58 pm
Thank you for the comment 🙂
February 21, 2016 at 10:21 am
You referred the Traded Debt. Should I assume they are all about the factoring? Also, if it is not the case, are all factoring things relate to the money market other than the stock exchange?
February 21, 2016 at 10:48 am
Traded debt is nothing to do with factoring.
Factoring is paying another company (the factor) to collect our debts. Traded debt is long-term borrowing (bonds, loan stock etc.)
(Factoring is dealt with in the lectures on working capital management)
February 21, 2016 at 11:20 am
Many thanks for your help!
On this occasion, should I assume that factoring and traded debt differ in the time of repayment and the place of trade (money market and stock exchange, respectively)?
Also, as traded debts are handled in on the stock exchange, should I treat it as the security-like stuff? And, is the process of issuing traded debt a kind of securitilisation?
February 21, 2016 at 11:52 am
Factoring is nothing to do with traded debt – it is paying others to collect our receivables. Usually we can therefore expect to receive the cash from receivables sooner.
Traded debt is bought and sold on the stock exchange in exactly the same way as shares. The only difference being that fixed interest is paid on the debt (whereas the dividend paid on the shares fluctuates) and the debt will be repaid to the lenders (whereas shares are not repaid).
Long-term debt can be linked to securitisation but that is not normally the case. It is simply a term meaning long-term borrowing.
February 21, 2016 at 12:09 pm
Many thanks John!
Have a great day!
February 21, 2016 at 3:24 pm
You are welcome 🙂
February 8, 2016 at 11:06 am
Hey john…..great lecture. Its really helpful…now i have a doubt…u know, i hav only recently joined opentuition…so till this time i was using bpp textbooks.. And it says that bonds are not traded extensively on a stock exchange whereas u say they do…so i’m in a bit of confusion…please clear that… Advance thanks…
February 8, 2016 at 1:44 pm
There are certainly bonds traded on the stock exchange, although there are not as many as there are shares traded.
More importantly, in the exams calculations of the WACC virtually always include bonds traded on the stock exchange (which is why they have a market value).
February 2, 2016 at 4:16 am
Great lecture as usual! Nominal value means face value right?
and are the alternative lectures same as the 41 min lect? Pls do let me know :). Thnks
February 2, 2016 at 7:52 am
Nominal value is the amount printed on the share certificate and the amount that appears in the Statement of financial position (which is not the same as the share price on the stock exchange).
November 1, 2015 at 8:01 pm
thx for the lecture
November 2, 2015 at 7:21 am
July 3, 2015 at 3:55 pm
the vedios on my lectures not showing
July 3, 2015 at 4:22 pm
The videos are working fine.
Please go to the support page if you are having problems – the link is above.
August 24, 2015 at 7:32 am
after 17 min i can hear your voice only but video stuck …
August 24, 2015 at 8:23 am
Try another browser / reload the page and go to that part of the video again..
September 23, 2014 at 5:54 pm
Thank you for the lecture, but I don`t understated how you get the redemption yield?
September 23, 2014 at 9:17 pm
As I said in the lecture, you cannot be asked to calculate the redemption yield!
Just be aware that it means the overall return from the investment, taking into account not just the interest each year but also the gain or loss on redemption.
September 13, 2014 at 7:14 am
I am cofusedd about the exaple of convertible debentures…in the ans you have said that the discount factor using is 10% as investr required return…but the are relating to the 8% which is the debentures interest?
May 23, 2014 at 4:04 pm
Please can you help me with redemption yield. I am aware that this is the overall return earned by investors but in your example you say its ‘say 7%’. How do you know that it will be less than the interest yield? Please can you explain it I have watched your lecture but i’m still unsure.
February 27, 2014 at 9:01 am
Hi Sir, what is the difference between this lecture and the alternative one? This one is 41 minutes and the alternative one is only 15 minutes. Thanks 🙂
February 27, 2014 at 3:07 pm
Why don’t you watch them both and then you will know, and you can post the answer 😉
February 26, 2013 at 11:58 pm
pliz help me understand…the amont to be redeemed after period of bond is the pc/nominal value right
September 12, 2013 at 9:21 am
Yes, the amount you get paid at the end is the $100 which represents the nominal value.
October 8, 2012 at 10:42 am
I have a question regarding the redemption rate in the last example:
How I calculate it?
It is 13(annual coupon)-40/8(the dif between the nominal value and quoted price)=8%
October 8, 2012 at 2:48 pm
@leventegergely, Calculating it is not in the syllabus, but the way you calculate it is to calculate the Internal Rate of Return.
September 11, 2012 at 5:34 pm
CAN any one plz… tell me what is a difference between bond and debenture…
November 9, 2012 at 10:51 am
@mohsinjaved, same thing different name.
November 19, 2012 at 7:48 pm
@mohsinjaved, Time to check 18:13 of THIS lecture.
May 5, 2013 at 2:25 am
Gov gilts and securities are debentures it’s secure short term investment and the bonds are could be long term as well
May 5, 2013 at 11:28 am
Debentures can be long term. Debentures and bonds are two words meaning the same.
May 25, 2012 at 8:10 pm
i am very pleased with the tuition received.
May 18, 2012 at 8:55 am
the lecture is brilliant.i hope the lecturer provides f8 lecture as well.
May 6, 2012 at 7:39 pm
Thank you very much. Amazing and wonderful. Do you think if I followed only your lectures, it is enough for the passing exam.please forward me past pappers,s lectures. Thank again.
April 5, 2012 at 3:55 pm
brilliant lecture 🙂
March 6, 2012 at 4:01 pm
why are these lectures from Chapter 10 responding with message ” server not found” . is it being worked on ? because i need to listen to these lecvtures badly.
March 6, 2012 at 4:05 pm
reload the page, lecture is there,
If you still having problems, you should contact your Internet Service Provider to check this for you
February 4, 2012 at 6:34 pm
November 28, 2011 at 11:55 am
This is the part a on debts.Could you pls tell us where the rest is, such as b, c and so on.
Or Will it go with the old lectures to cover the rest?
November 18, 2011 at 8:16 am
i can’t see the vidio ,they can’t be linked to ,
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