Most of our coverage at the IC revolves around shares. But there are other (nominally less risky) ways to invest in companies, one of which is through the Order Book for Retail Bonds (Orb). Orb is a limited market of easily tradable debt launched by the London Stock Exchange in 2011, which was initially pounced on by blue-chips looking for cheap finance. The issues proved really popular, and many readers will have subscribed to the large number of issues - some of which were tacked on to larger corporate bond offerings - in Orb's infancy.
Despite strong demand, new issues have now slowed to a trickle, with just five new entrants to the order book in 2015 (see table below). "[Issuance] has been light, and frankly I'm not sure I see that changing in the short term," says Hardman & Co analyst Brian Moretta. "The difference between now and three years ago, when the market was really strong, is that companies have many alternative routes to financing."
| Issuer | Date | Coupon | Maturity | Price | Yield |
|---|---|---|---|---|---|
| Paragon | August | 6 | 5/12/2020 | 101.975 | 5.54% |
| Wasps Finance | May | 6.5 | 13/05/2022 | 101.746 | 6.17% |
| Retail Charity Bonds | May | 4.4 | 30/04/2025 | 99.5 | 4.42% |
| Provident Financial | April | 5.125 | 9/10/2023 | 103.68 | 4.94% |
| Intermediate Capital | March | 5 | 24/03/2023 | 100.087 | 4.99% |