They therefore appealed to the bond market

Yields of 5 to 8: in the context of recent months, for such performance does are obviously not unnoticed. They were bonds issued by large industrial groups rated. This is the reason why they are also called "corporate". From there to declare 2009 "the year of the credit market," the not was quickly crossed.

"The opportunity is historic," to ignite early year Martine Simon-Claudel, Director-General delegate financial Union of France (UFF). Like this institution, of many management companies or private banks have made this investment theme an essential axis of their strategy. This is the case of Rothschild & Cie, Natixis Asset Management, the French of investments or Quilvest yet. New products "Duty Context 2014", LFP Oasis bond 2013 and 2011"and"Private Obligations 2012"bear witness to the vitality of the offer. However, is one such craze sustainable It would not reproduce the conditions with the obligations to form a bubble!

The return to grace of private debt finds its origin in the overcautiousness of banks to lend money to companies. Therefore, they were forced to find other ways of refinancing. They therefore appealed to the bond market. A practice has nothing exceptional in itself. Simply, that their paper is lessee in these also little mundane circumstances, companies had to match their offer particularly attractive rates. It was indeed reward risk taking. However, at this level where performance, it is as if the market was expecting a bankruptcy of the issuing company.

"Pseudo danger."

Thus, in January, a loan of EUR 1 billion, repayable in five and a half years, was launched by Saint-Gobain, with an annual coupon at 8.25. It soon was fully endorsed. But not only because of its performance. As explained Pascal Gilbert, managing the French of investments, "compared with the pay down of State bonds, that of the Saint-Gobain borrowing course appeared attractive." However, it does not it explain only the speed of his subscription. "It is also due to the confidence of investors with regard to the risk of insolvency of the issuer."

In other words, subscribers believed to the worst. They bought a "pseudo danger" particularly well paid. But if, over the months, the spectre of bankruptcy away, interest rates have always reason to be as high Not sure. Another question: if confidence returns to the banks, they submit to make loans. The use of the bond debt will more be the same character of emergency. Will its relevance as investment be always so obvious

In the meantime, everyone wants these products. However, individuals wishing to join the movement should be aware that purchase a duty to direct company falls within the feat. The secondary market is a little liquid, the primary market is crowded. Professional investors buy for quantities that disqualify the overwhelming majority of individuals. As they undergo expensive custody rights and transaction costs.

Criteria to verify

Then, individual investors should take into account all kinds of criteria such as the quality of the issuer, the liquidity of the title or the evolution of interest rates. Check the strength of the company is required to be assured of payment of the coupon and refund of the duty to its nominal value. However if the temptation is great to choose well-paid borrowing, remember that a duty is not devoid of risk. Let us remember that until the eve of his bankruptcy, September 15, Lehman Brothers had an "investment grade" rating: top in scoring!