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  • FIRST POST
    • Connie Hayes
    • By Connie Hayes 16th Sep 16, 7:56 AM
    • 1Posts
    • 0Thanks
    Connie Hayes
    Energy Bond
    • #1
    • 16th Sep 16, 7:56 AM
    Energy Bond 16th Sep 16 at 7:56 AM
    Has anyone taken out the new Energy Bond which they say is backed by the government. It advertises 3-5year bonds for 7% - 9.25%
Page 2
    • David Chippard
    • By David Chippard 8th May 17, 9:42 AM
    • 2 Posts
    • 1 Thanks
    David Chippard
    {text removed by MSE Forum Team} no intention to repay bond holders principle capital at all- their plan is to make a few interest payments to keep investors temporarily happy then to follow the small print t&c's and pay investors Bank of England base rate 0.5% instead of returning their initial investment. Disgusting company and ethos. Notice how the directors have a string of energy companies set up and dissolved s couple of years later- this is just the latest. Aslan Kaplan is one {text removed by MSE Forum Team}- terrible phone manner- never worked a professional day in his life- he makes Del Boy look like he went to Etonian! Stay firmly away!
    Last edited by MSE Andrea; 26-06-2017 at 9:21 AM.
    • John Parridge
    • By John Parridge 8th May 17, 9:55 AM
    • 2 Posts
    • 0 Thanks
    John Parridge
    Fre plc-
    not had much dealings with them so remaining impartial
    Last edited by John Parridge; 23-06-2017 at 10:57 AM.
    • John Parridge
    • By John Parridge 8th May 17, 9:57 AM
    • 2 Posts
    • 0 Thanks
    John Parridge
    didnt invest but that was for personal reasons as opposed to the company
    Last edited by John Parridge; 23-06-2017 at 10:58 AM.
    • abitsmith
    • By abitsmith 9th Nov 17, 7:58 AM
    • 3 Posts
    • 1 Thanks
    abitsmith
    Hi Bonnie. I enquired about this and the offer sounds very good - too good to be true?
    Did you invest?
    It's not backed by the government, but rather depends on government subsidies that were offered to renewable energy companies (which were recently reduced). For that reason, FRE no longer builds wind farms because they don't return as much as they did.
    They have "just launched Phase Four", in which they are not building new wind farms, but purchasing operational sites that continue to benefit from the large govt subsidy available in 2015. So their revenue streams are (a) govt subsidy fixed for a further 18 years and (b) energy sales. I'm being offered up to 10% yield, which is unheard of in this market. I would have been pleased with
    I need to invest a small sum and I am not keen on equities for ethical reasons, which is why I was looking at debt-based vehicles.
    The salesman says the bond is administered by Talbot Capital, that its capital assets (land, turbines, etc.) have been surrendered and that bond holders have First Legal Charge should the company go under. It has now been trading for several years and paying dividends. What else can I do to check that it is indeed too good to be true?
    • Malthusian
    • By Malthusian 9th Nov 17, 9:41 AM
    • 3,421 Posts
    • 5,237 Thanks
    Malthusian
    The salesman says the bond is administered by Talbot Capital, that its capital assets (land, turbines, etc.) have been surrendered and that bond holders have First Legal Charge should the company go under. It has now been trading for several years and paying dividends. What else can I do to check that it is indeed too good to be true?
    Originally posted by abitsmith
    It's not too good to be true, it's an ultra-high-risk investment that can lose 100% of your money. 10% yield is at best par for the course. Similar yields are available from corporate loans to UK banks. Not that I'd lend money to them either, but they've been around for longer and have a longer history of paying returns to bondholders than this outfit.

    First Legal Charge on what? What assurance is there that the collateral, if sold, will be sufficient to repay bondholders? Assuming that the collateral is the wind farm, how much are the liquidators likely to get for a bunch of giant fans that couldn't generate enough electricity to be viable?

    Why do you feel owning part of a company is unethical but loaning money to it not unethical?

    It's a strange set of ethics that says that owning part of a company is unethical but cold calling unsophisticated investors to flog them "everything from carbon credits to diamonds to land now in bonds in a wind turbine" and fail to pay the promised returns is perfectly ethical because it's green. (See David Chippard's posts currently #20 and #21. We can assume these facts are true, because someone's lawyers have been at this thread judging by the amount of "text removed by MSE Forum Team", so if they weren't true they'd've been removed.)
    • dunstonh
    • By dunstonh 9th Nov 17, 9:44 AM
    • 89,840 Posts
    • 56,490 Thanks
    dunstonh
    Hi Bonnie. I enquired about this and the offer sounds very good - too good to be true?
    Did you invest?
    It's not backed by the government, but rather depends on government subsidies that were offered to renewable energy companies (which were recently reduced). For that reason, FRE no longer builds wind farms because they don't return as much as they did.
    They have "just launched Phase Four", in which they are not building new wind farms, but purchasing operational sites that continue to benefit from the large govt subsidy available in 2015. So their revenue streams are (a) govt subsidy fixed for a further 18 years and (b) energy sales. I'm being offered up to 10% yield, which is unheard of in this market. I would have been pleased with
    I need to invest a small sum and I am not keen on equities for ethical reasons, which is why I was looking at debt-based vehicles.
    The salesman says the bond is administered by Talbot Capital, that its capital assets (land, turbines, etc.) have been surrendered and that bond holders have First Legal Charge should the company go under. It has now been trading for several years and paying dividends. What else can I do to check that it is indeed too good to be true?
    Originally posted by abitsmith
    Take a read of post #3 on this thread.

    A number of mini-bonds have failed in the last few years with 100% loss to the investors. This is not a retail financial product. It is a high risk unregulated 100% capital at risk instrument.

    All those mini bonds that failed also paid out successfully for many years before failing. It is one of the risks you have to accept. That is why these are restricted in how they can be marketed. They are not meant for inexperienced investors. Even professional investors wouldnt put more than 5% of their investable wealth in such a thing.

    Your ethical stance is interesting. Owning a company is unethical to you but loaning money to a company is fine?
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • bostonerimus
    • By bostonerimus 9th Nov 17, 1:13 PM
    • 1,211 Posts
    • 668 Thanks
    bostonerimus
    mini-bond......7% to 9.25%.....those are enough reasons not to bother with this "investment".

    I like bonds to reduce the volatility of my portfolio, not increase it. I would only buy individual bonds, debentures etc. from either G7 governments or of corporate investment quality. I also like to spread risk by using bond funds, even with the issue of rising interest rates.
    Misanthrope in search of similar for mutual loathing
    • abitsmith
    • By abitsmith 11th Nov 17, 8:17 AM
    • 3 Posts
    • 1 Thanks
    abitsmith
    Thank you.
    I just needed someone to confirm my instinct that this investment was not for me. I wasn't hoping for a virtual slap, but I'll take it as part of the package.

    Yes my ethics are strange. I don't like the stock market very much because it places companies' legal responsibility to shareholders above customers, employees, the environment or the communities in which they operate and requires a permanent state of economic growth, which is inherently unsustainable. I would prefer to invest in bonds than equities is all. But this company is a PLC, so it is part of that system anyway.

    NB there was no cold call. That would have been a red flag. I went looking for debt instruments investing in an ethical product. I immediately suspected this was not a good idea which is why I asked. Thanks again for setting me straight.
    • abitsmith
    • By abitsmith 11th Nov 17, 8:49 AM
    • 3 Posts
    • 1 Thanks
    abitsmith
    Can anyone recommend a debt instrument that is ethical, safe and provides a halfway decent return? I'm not expecting 10% or anything like that, but stumbled across FRE in my search.

    I can ask my IFA but I will pay 3% for the guidance so I started looking for myself. I had planned to put my money towards buying a property, but given the trajectory of that market I thought it better to rent for a while and wait until prices drop a bit further.
    • le loup
    • By le loup 11th Nov 17, 9:16 AM
    • 3,656 Posts
    • 3,586 Thanks
    le loup
    I wasn't hoping for a virtual slap, but I'll take it as part of the package.
    Originally posted by abitsmith
    Don't take it as a slap. The strong comments only arise because those making them know the dangers of such "investment opportunities". In order to guide people, they put up all the warnings that are not prominent in adverts and web sites.

    If something is blindingly obvious to people they sometimes can't understand why it's not blindingly obvious to everyone.

    So, welcome to this site and if you need anymore help don't be put off.
    • dunstonh
    • By dunstonh 11th Nov 17, 12:41 PM
    • 89,840 Posts
    • 56,490 Thanks
    dunstonh
    I can ask my IFA but I will pay 3% for the guidance so I started looking for myself.
    IFAs dont give guidance. They give advice. Each IFA has their own charging structure. Its not 3% across the board. You will get good value ones and expensive ones. You will get prestige firms and local service firms. Rural and city firms and those with different business models and target markets.

    However, one thing you will find consistent across the board is that they will not recommend a mini-bond for an inexperienced investor.

    Can anyone recommend a debt instrument that is ethical, safe and provides a halfway decent return?
    No such thing exists that meets that criteria.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • bigadaj
    • By bigadaj 11th Nov 17, 2:04 PM
    • 10,804 Posts
    • 7,098 Thanks
    bigadaj
    Can anyone recommend a debt instrument that is ethical, safe and provides a halfway decent return? I'm not expecting 10% or anything like that, but stumbled across FRE in my search.

    I can ask my IFA but I will pay 3% for the guidance so I started looking for myself. I had planned to put my money towards buying a property, but given the trajectory of that market I thought it better to rent for a while and wait until prices drop a bit further.
    Originally posted by abitsmith
    How are you defining ethical?

    Do you support nuclear power, with no carbon emissions, or solar and wind farms with local blight?

    Do you support tech firms paying near zero tax?

    Are you pro pharma, or do you prefer no new drugs and other health solutions?

    Rechargeable batteries with slave labour producing minerals in Africa and South America?
    • bostonerimus
    • By bostonerimus 11th Nov 17, 2:38 PM
    • 1,211 Posts
    • 668 Thanks
    bostonerimus
    Can anyone recommend a debt instrument that is ethical, safe and provides a halfway decent return? I'm not expecting 10% or anything like that, but stumbled across FRE in my search.
    Originally posted by abitsmith
    Interest rates are low right now so you won't get much from fixed income where your principal is guaranteed. So you need to balance your desire for yield with your appetite for risk. You can get a bit more guaranteed return if you agree to lock your money up for some time....maybe 5 years.

    So on the safe end of things you could create a ladder of National Savings or other guaranteed savings bonds with terms out to at least 5 years......next you could look at Government backed individual bonds that you hold to term and investment grade corporate bonds........there's also P2P and then riskier and high yield bonds.

    I'm in the US and I have a friend who just bought a closed end high yield bond fund (PHK). It's yield is 12%, but you have to factor in premium and the NAV and it's very risky. For my guaranteed fixed income I'm happy to get 2% from a savings bond where I keep some cash and 4.38% from a deferred "annuity" {it's not really an annuity) that restricts access to my capital over a decade, but that's an old contract and not available anymore. I also use a bond tracker fund and reinvest all income. It's yield is 2.5% and YTD the return is 3.5%, but if interest rates go up its price will fall, so I don't plan on spending from it in the near future and just use it as a dampener on volatility and hope for a bit of long term gain.
    Last edited by bostonerimus; 11-11-2017 at 2:51 PM.
    Misanthrope in search of similar for mutual loathing
    • Eco Miser
    • By Eco Miser 11th Nov 17, 6:11 PM
    • 3,218 Posts
    • 2,979 Thanks
    Eco Miser
    Yes my ethics are strange. I don't like the stock market very much because it places companies' legal responsibility to shareholders above customers, employees, the environment or the communities in which they operate and requires a permanent state of economic growth, which is inherently unsustainable. I would prefer to invest in bonds than equities is all.
    Originally posted by abitsmith
    The companies' legal responsibility to bondholders is above that to shareholders, so your ethical stance is very strange.
    Actually shareholders, aka owners, are well down the list if things go wrong and the company is wound up.
    Eco Miser
    Saving money for well over half a century
    • Voyager2002
    • By Voyager2002 11th Nov 17, 7:14 PM
    • 11,717 Posts
    • 7,937 Thanks
    Voyager2002
    Two legitimate ways to invest in renewable energy and so benefit from schemes whose income is effectively guaranteed: Greencoat UK Wind and The Renewable Infrastructure Group. Both are investment trusts: I currently hold shares in the former and intend to buy some in TRIG. Greencoat offers a dividend equivalent to 5 per cent and intends this to increase with inflation. Obviously the price of the shares can and does vary (and could fall), but in recent years has shown fairly low volatility.

    And a big 'welcome back' to DunstonH!
    • bostonerimus
    • By bostonerimus 12th Nov 17, 2:34 PM
    • 1,211 Posts
    • 668 Thanks
    bostonerimus
    Two legitimate ways to invest in renewable energy and so benefit from schemes whose income is effectively guaranteed: Greencoat UK Wind and The Renewable Infrastructure Group. Both are investment trusts: I currently hold shares in the former and intend to buy some in TRIG. Greencoat offers a dividend equivalent to 5 per cent and intends this to increase with inflation. Obviously the price of the shares can and does vary (and could fall), but in recent years has shown fairly low volatility.

    And a big 'welcome back' to DunstonH!
    Originally posted by Voyager2002
    Such niche closed end funds are going to come with significant risk. They are for the sophisticated investor and should only form a small percentage of a portfolio.
    Misanthrope in search of similar for mutual loathing
    • Voyager2002
    • By Voyager2002 12th Nov 17, 4:02 PM
    • 11,717 Posts
    • 7,937 Thanks
    Voyager2002
    Such niche closed end funds are going to come with significant risk. They are for the sophisticated investor and should only form a small percentage of a portfolio.
    Originally posted by bostonerimus
    All risk is significant, and no single asset class should be allowed to dominate anyone's portfolio. Having said that, the figures that Morningstar publishes for the volatility of these shares (an accepted measure of risk) are lower than for most of the Funds and Unit Trusts that I have examined.
    • bostonerimus
    • By bostonerimus 12th Nov 17, 4:18 PM
    • 1,211 Posts
    • 668 Thanks
    bostonerimus
    All risk is significant, and no single asset class should be allowed to dominate anyone's portfolio. Having said that, the figures that Morningstar publishes for the volatility of these shares (an accepted measure of risk) are lower than for most of the Funds and Unit Trusts that I have examined.
    Originally posted by Voyager2002
    I'm sure you've done your research and I think we are in broad agreement. The portfolio is only within the UK and obviously political factors can be important when it comes to these energy schemes which is why they need to be carefully assessed.
    Misanthrope in search of similar for mutual loathing
    • chrisgg
    • By chrisgg 12th Nov 17, 10:17 PM
    • 24 Posts
    • 15 Thanks
    chrisgg
    Can anyone recommend a debt instrument that is ethical, safe and provides a halfway decent return? I'm not expecting 10% or anything like that, but stumbled across FRE in my search.
    Originally posted by abitsmith
    It's going to be hard to tick all those boxes. Something like Rathbones Ethical Bond fund is probably as good as you'll get. Unless you're willing to hold Renewable Energy ITs or something like that.
    • Malthusian
    • By Malthusian 13th Nov 17, 10:56 AM
    • 3,421 Posts
    • 5,237 Thanks
    Malthusian
    I don't like the stock market very much because it places companies' legal responsibility to shareholders above customers, employees, the environment or the communities in which they operate and requires a permanent state of economic growth, which is inherently unsustainable. I would prefer to invest in bonds than equities is all.
    Originally posted by abitsmith
    "Capitalism - Proudly Unsustainable for 250 Years and Counting."

    Eco Miser beat me to the point that bonds are even more unethical than equities, because companies' legal responsibility to bondholders ranks above their legal responsibility to shareholders.
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