Private Equity Solutions

Private Equity Fund Of Funds Convertible bonds are bonds issued by corporations that are backed by the corporations' assets. In case of default, the bondholders have a legal claim on those assets. Convertible bonds are unique from other bonds or debt instruments because they give the holder of the bond the right, but not the obligation, to convert the bond into a predetermined number of shares of the issuing company. Therefore, the bonds combine the features of a bond with an "equity kicker" - if the stock price of the firm goes up the bondholder makes a lot of money (more than a traditional bondholder). If the stock price stays the same or declines, they receive interest payments and their principal payment, unlike the stock investor who lost money.
Why are convertible bonds worth considering? Convertible bonds have the potential for higher rates while providing investors with income on a regular basis. Consider the following:

1. Convertible bonds offer regular interest payments, like regular bonds.

1. Downturns in this investment category have not been as dramatic as in other investment categories.

1. If the bond's underlying stock does decline in value, the minimum value of your investment will be equal to the value of a high yield bond. In short, the downside risk is a lot less than investing in the common stock directly. However, investors who purchase after a significant price appreciation should realize that the bond is "trading-off-the-common" which means they are no longer valued like a bond but rather like a stock. Therefore, the price could fluctuate significantly. The value of the bond is derived from the value of the underlying stock, and thus a decline in the value of the stock will also cause the bond to decline in value until it hits a floor that is the value of a traditional bond without the conversion.

1. If the value of the underlying stock increases, bond investors can convert their bond holdings into stock and participate in the growth of the company.

The equity and bond markets both delivered greater overall returns to investors in May, though over the past 12 months (which strips out some of the volatility in bond and equity markets), at 17.9% in May compared to 16.5% and 11.0% for equities and government bonds respectively.

Curve Equity Exposed Fund During the past five years, convertible bonds have generated superior returns compared to more conservative bonds. Convertible bonds have generated higher returns because many companies have improved their financial performance and have their stocks appreciate in value.

FF&P Private Equity provides its clients with the opportunity to invest in the equity of high growth, unquoted companies whose objective is to generate attractive returns through the subsequent listing, or trade sale, of these companies. FF&P Private Equity invests typically â5 million to â25 million of equity per transaction and places particular emphasis on backing commercial managers with a track record in successful execution of business plans and enhancing shareholder value. //www.ffandp. equity.

Equity Income Funds Convertible bonds can play an important role in a well-diversified investment portfolio for both conservative and aggressive investors. Many mutual funds will invest a portion of their investments in convertible bonds, but no fund invests solely in convertible bonds. Investors who want to invest directly could consider a convertible bond from some of the largest companies in the world.

During the previous five years, high yield bonds have generated superior returns compared to more conservative bond funds. However, these returns are less than those of some aggressive equity funds. Investors should invest a portion of their portfolio in this investment category to reduce their risk and increase their income and return potential.

Capital Casebook Equity About the author: Tony Reed is the author of " Upside potential with convertible bonds", please visit his website Bonds trading & Bonds market for more information.

Now you want to be about half in bonds, with your stocks being blue chips from the S&P 500, if not the Dow 30. Proctor and Gamble (PG), Altria (MO). Wind down your working years by moving at least 90 percent into bonds. As a result, you can afford to get a little risky with the equity portion of your portfolio in hopes of realizing some outsized gains just before retirement. Ladish Company (LDSH), Cognizant Technology Solutions (CTSH).

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