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Assured Guaranty Ltd. Message Board

  • domsam100 domsam100 Apr 9, 2010 12:29 PM Flag

    Is there any upside left for the AGO minibonds?

    How high in price that each one of the three would reach?

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    • Domsam,

      I believe t Moody's rating is lower than it should be because the rating places it the bottom of its upper medium grade category. Moody's is actually two notches lower than S&P's rating. I'm no bond expert, but think a case can be made for the mini-bonds to be in the high grade quality tier since they're related exclusively to the municipal side of AGO's business. The lowest rating in this tier would be Aa3 for Moody's and AA- for S&P.

    • _Assured Guaranty Municipal Corp. is the new name of Financial Security Assurance Inc., which Assured Guaranty acquired in July 2009. AGM, which began operations in 1985, is a New York-domiciled financial guaranty insurance company licensed in all 50 states, the District of Columbia and Puerto Rico. It is a direct financial guaranty company and is focused exclusively on public finance markets. AGM has insurer financial strength ratings of AAA from Standard & Poor’s and Aa3 from Moody's Investors Service. AGM has a similarly rated U.K. subsidiary, Assured Guaranty (Europe) Ltd., which is regulated by the Financial Services Authority of the United Kingdom and authorized to write insurance in most countries in the European Economic Area. In addition, AGM maintains a Tokyo branch. _

      Tony, you are right wrt ratings of AGO minibonds.

      A question is: Are they under rated ?

      Disclaimer: I am not an expert on ratings.

    • Domsam,

      The current Moodys rating on the AGO minibonds is A3 and for S&P, A+.

    • Old "FSA" is now AGO, and they're fixed income securities traded on NYSE are -B, -E, and -F.

    • AGM (old FSA) has AAA from S&P and AA from Moody’s.

      Pls correct me if I am wrong.

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    • Tony:

      I agree with your thoughts. The shopping for good quality and good
      yielding fixed income instruments is tough right now. Best to be patient
      patient right now. Better deals will arrive soon enough but we'll probably
      have to wait at least a year or so.

      I'm doing lots of homework and flagging instruments I want to buy
      and at what price.

      For the most part, I'm currently letting cash pile up in brokerage accounts so
      so I'll have plenty of ammo ready when the buying is good again.

      I would recommend opening a brokerage accont with a broker that will
      provide acess to lots of regular corporate, municipal, and agency bonds.

      Pesistentone complains about the "regular" bond market but I still find
      good deals there from time to time. The liquidity is tough on individual
      investors but that is exactly why I find the good deals I do. I occasionally
      find small lots of good bonds that some small investor decided he had to
      sell and the big boys are not playing ball so he has to offer at a good price. You have to be patient in that market as well though.

      I'm also making some good money by selling small numbers of naked puts against common stocks that I would like to own but at alower price. Many
      people believe this strategy is risky but it's not if you size your shorts appropriately.

    • Jim:

      Thanks for the link to the WSJ tables. I'm definitely bookmarking.

      By the way, stay away from those Ambac bonds.

    • Just my 2¢, this is a place to start for names, but not much left after the "crisis" has past.
      And all that's left are the suspended dividend types and most are at 75¢ as it is, with the AKF and AKT issues remaining "interesting"...

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