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Why does "ABF Pan Asia Bond Index Fund" have such high yield?

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  1. #1

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    Why does "ABF Pan Asia Bond Index Fund" have such high yield?

    I don't understand what the "ABF Pan Asia Bond Index Fund" is about.

    According to Reuters the yield (calculated, as you know, using last year's dividend and the current price), is 17%.

    How come?


  2. #2

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    This is ETF listed in HK .Code 2821
    listed on 7th July 2005 at US$100/ per unit. Today's price is US$111.7
    Any Dividend paid has to be added to get the total yield.


  3. #3

    I doubt it. Check its fact sheet, the averge yield (of the underlying bond?) is only 5.23%. And price itself has barely moved.

    http://www.abf-paif.com/eng/pdf/factsheet_eng1.pdf


  4. #4

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    Quote Originally Posted by Oldtimer:
    This is ETF listed in HK .Code 2821
    listed on 7th July 2005 at US$100/ per unit. Today's price is US$111.7
    Any Dividend paid has to be added to get the total yield.
    Oh. They don't pay out the dividend to those who buy the fund? So why does the Reuters page say that the dividend was US$18.99?

    And, isn't the yield calculated per year? If it was US$100/per unit in 2005, and about US$112 at the beginning of this year, and now it's US$111.7, how can the yield be 17% if they don't pay out the dividend?
    Last edited by pinko; 11-07-2008 at 01:51 PM.

  5. #5

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    It's a data error. The annual yield to 4 July was 5.24% as you can see on the fund's homepage. The last two distributions were US$2.05 in August 07 and US$2.16 in February 08.

    Last edited by PDLM; 11-07-2008 at 02:23 PM.

  6. #6

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    Thanks .


  7. #7

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    is that the only Bond etf on hk stock market right now?

    closed at 114.95 today...seem a little high, but this beats putting your money in the bank.

    this is just like buying bonds, but easier.


  8. #8

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    what are the risks? so far after reading this article,

    The Asset - MAGAZINE-First Asian bond fund ETF posts steady growth through crisis

    this etf seems to be underperforming the benchmark a little bit, but etf's management fee is priced in already, so maybe that explain the difference?

    not sure how they manage this fund...i am just guessing, they just buy and hold the bond until maturity? (correct me if i am wrong here) so you get two dividend payout every year in jan and july...that comes out to be 3.6%...which is not that bad compare to savings rate. but you have to figure in the Script fee and handling charges for dividend payouts from your brokerages.(i think that is about 2.5% of your dividends)


  9. #9

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    Quote Originally Posted by pico:
    closed at 114.95 today...seem a little high, but this beats putting your money in the bank.
    Eh? On what basis do you make that statement? The price of a fund is a pretty arbitrary number.

    You can see the performance here: http://www.abf-paif.com/hk/eng/pdf/factsheet_eng1.pdf

    As with pretty much all funds, it underperforms the relevant index.
    Last edited by PDLM; 03-03-2010 at 09:16 PM.
    pico likes this.

  10. #10

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    The underlying index data is available below. You need a free registration, but you can see the underlying bonds for not only ABF Asia, but also many other iBoxx indices.

    Markit Indices

    The site is designed for people who are very much into the bond market. The yield for the underlying index is sub 4%.

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