I just put in an order for the BP Yankee bond with the cusip number 05565QBG2, the 2.125% of March 10, 2012. I had to buy $20,000 of face value rather than 10,000 anticipated when I wrote the trade up this morning.
Although Barrons’ said it was priced at $94.25 per bond, the best quote I could get from E-trade was $95. That means the yield to maturity is 6.274% rather than 6.818% as reported at the close of last week. In addition as always I have to pay $211.81 in interest to the seller for 120 days. This shows that the bond pays not quarterly as I supposed but semi-annually.
The boom in BP is affecting not just the stock but also the bond. I am not sure if I will get my bonds at $95 and if I don’t I will not be too upset. This play is too widespread to work. If the trade does not get done I will come up with another idea for yield.
