Ups and downs when investing in perpetual securities

The source of the most recent concerns about perpetual securities stems from water treatment firm Hyflux's decision to suspend trading in its perps.
The source of the most recent concerns about perpetual securities stems from water treatment firm Hyflux's decision to suspend trading in its perps.PHOTO: LIANHE ZAOBAO

While they offer higher coupons, they come with interest-rate and credit risks

Perpetual securities (perps) have been making headlines lately and likely giving investors second thoughts about adding them to their portfolios. The source of the most recent concerns stems from water treatment firm Hyflux's decision to suspend trading in its perps.

But while perps have downsides, including no maturity date, they can work for some investors.

Please or to continue reading the full article. Learn more about ST PREMIUM.

Enjoy unlimited access to ST's best work

  • Exclusive stories and features on multiple devices
  • In-depth analyses and opinion pieces
  • ePaper and award-winning multimedia content
A version of this article appeared in the print edition of The Sunday Times on June 24, 2018, with the headline 'Ups and downs when investing in perpetual securities'. Print Edition | Subscribe