3 ms·
That 7.375% on the Coca-cola bond looks like the coupon (approximate yield) from its initial issue, which appears to be in 1993. ("Ticker: KO 7.375 07/29/93")
by SilasX 3y ago
That 7.375% on the Coca-cola bond looks like the coupon (approximate yield) from its initial issue, which appears to be in 1993. ("Ticker: KO 7.375 07/29/93") The yield-to-maturity (yield calculated from current market price) is likely to be lower. Coca-Cola is A-rated[1], and Schwab is showing A-rated corporate bonds as yielding 5% (3-month) to 6.4% (30 years)
[1] https://www.fitchratings.com/entity/the-coca-cola-company-80542325 https://www.fitchratings.com/entity/the-coca-cola-company-80...
- mrcode007 3y agoYea that is correct. There are tons of other bonds at varying yields and default risks. Check out Apple and Tesla bonds for comparison for example.
- SilasX 3y agoNone of which are yielding in the Coca-Cola ballpark without significant default risk. The broader point about bonds clearly beating S&P earnings is dubious.
- ffhhttt 3y agoApple bobs yield just ~0.9% or so kore than 10 year treasuries. You have to go for much riskier companies to get significantly above 5%. Of course if there is a recession, the stock market tanks and most importantly the Fed starts cutting rates you might do quite well (assuming you’re willing to sell those bonds afterwards).