Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.
15/6/23 MM is adding the above to its Active Income Portfolio. I am not familiar with dealing with bonds so I typed the code on Commsec search and to my surprise, results shown were, currently 1 seller and 2 buyers only, and 2 trades done at 10.35am. Are there any other trading sites etc that has a higher turnover/ activities?
Hi Michael,
These are ASX listed Government Bonds. They do appear illiquid but it is a highly liquid market. The bid will have generally have 10,000 units and the offer will have the same and these will be 30pts apart, which is the spread – or the cost of trading them on the exchange as opposed to going through an Over The Counter bond broker who charge custody etc on top of a spread. To buy, you’ll more often than not have to pay the offer (the 10k), and to sell, you’ll more often than not need to hit the bid (the 10k). At times there may be small orders in between which will be retail orders but there is a lot more liquidity in this market than it appears. I have traded large lines of these and never had a liquidity issue.
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