Investment Matters

Good bye to the successful Crown Notes

The sale of the Crown Notes (CWNHB) from Equity portfolios was completed for all clients last week.  The issuer, Crown Resorts, was in takeover discussions with US gambling giant Wynn Resorts until these were terminated (following the discussions becoming public).  We had been progressively selling this investment down prior to this event.

[Note: Clients with an Income Securities allocation retain ownership of these securities.]

The CWNHB securities were purchased in Nov-16 at an average price of $84.99 per security.  They were purchased on the basis that they offered a capital growth opportunity through the discount to face value ($100), a good ongoing distribution (income), along with a favourable risk profile.

For typical clients, the average sale price was $102.4 per security.  Additionally, $14.5 in distributions per security were paid over the period of ownership.  For clients who owned the investment for the full period, this culminated in an annualised return of greater than 15% p.a.

Source: First Samuel, IRESS

- Fleur Graves