(This article was last updated in June 2023)
This brief review will talk about Pardus Fixed Income Bond.
For any questions, or if you are looking for better investments as an expat or high-net-worth individual, you can contact me using this form, or via email – email@example.com.
This review is especially important now that Pardus are late in paying bond holders as I explained here.
This news doesn’t make a default guaranteed, but it does mean that I wouldn’t add fresh money if I were a client.
What is more, the chances of default are now much higher.
Table of Contents
What is Pardus Fixed Income Bond?
Pardus Fixed Income Bond is a fixed-return investment that is offered by Pardus Fixed Income Bond plc. The investment is primarily sold to expats in the Middle East, Europe, South America and beyond, but can also be offered to locals.
The investment duration with Pardus Fixed Income Bond is two years. It offers between 1% to 2% return on investment per month, depending on which introducer is offering the bond.
Frankfurt Stock Exchange-listed Pardus Fixed Income Bond plc has changed its name to Pardus Capital Holdings plc in late 2021. The firm is headquartered in London, UK, and has an office in Hong Kong.
Who has access to Pardus Fixed Income Bond?
Sophisticated individuals with high and ultra-high net worth are the target investors of Pardus Fixed Income Bond. Not only that, your appetite for risk must be in the mid to high levels.
What is the minimum investment?
You would need at least 100,000 pounds (118,770 US dollars or 112,973 euros as of the time of writing) to be eligible to invest in Pardus Fixed Income Bond.
With a hundred thousand pounds in minimum investment, you could expect to reap over the investment period of two years a return of 121,520 pounds, sans the preliminary charge of 2%, according to Pardus Capital Holdings. The yield will be paid out every quarter.
The money is used for arbitrage trading. In other words, to exploit very small differences in price between the same assets in more than two markets.
How is my investment in Pardus Fixed Income Bond guaranteed?
Pardus Capital has entered into a partnership with Woodside Corporate Services to have them serve as its Security Trustee and a Collateral Manager. This firm holds a registered debenture in order to remunerate issuers and bondholders for any loss that may be incurred.
Are fixed income securities, such as a bond, generally safe?
Investors in fixed-income securities receive a predetermined amount of interest income each and every year for the duration of the life of the bond. Fixed-income securities have the potential to not only trim the aggregate risk of an investment portfolio but also to defend against the large swings and volatility that the market is prone to.
Equities have historically been known to have a higher degree of price volatility compared to bonds, which means that changes in their value can result in greater opportunities for capital gains but greater potential losses as well.
As a consequence of this, a lot of people who invest their money choose to put some of it into bonds rather than stocks so that they can lessen the impact of the volatility that comes with stock investing.
It is essential to keep in mind that the valuations of bonds and other fixed income securities are subject to both increases and decreases. Fixed-income securities are characterized by the consistency of their interest payments; however, it is not possible to guarantee that the prices of these securities will remain unchanged over the course of the bonds’ entire maturities.
For instance, if investors dispose of their securities prior to their maturation date, there is the potential for gains or losses because of the difference between the price the securities were acquired for and the price for which they were offloaded.
If you don’t dispose of the bond until it matures, you will get the bond’s face value. However, if the bond is sold before maturity, the sale value is most likely to vary from the bond’s face value.
What are the positives associated with investing in Pardus Fixed Income Bond?
The main positives are:
- It has performed well so far and importantly can give an investor a diversification tool within a wider portfolio. Holding Pardus Fixed Income Bond as one small component of a wider portfolio isn’t super risky given the returns on offer. This was at least a positive until the recent delayed coupon payments.
- The investment is listed on the Frankfurt Stock Exchange, but essentially this is something that can be paid for.
- It is an uncorrelated asset, which means it can perform well if stock markets do badly during a period of time and produce income.
- It isn’t a very long-term commitment. You aren’t locking your money in for say seven years like in many private equity deals.
What are the negatives associated with this investment?
The main negatives are:
- There are, on balance, superior high-net-worth investments, which offer a similar return for a little less risk.
- The previous point isn’t just applicable to assets of high net worth; it is also relevant for stock markets. If you are prepared to deal with the volatility of investing in the S&P500 or Nasdaq, you will achieve double-digit returns if (and that is a big if) the markets produce what they have done historically, which is 10% per year for the S&P500 and 12% for the Nasdaq. You just need to deal with the volatility, which isn’t a good measure of risk.
- The investment is locked in for a period of time. If you have an emergency, it is difficult to get out in time, even though it isn’t super long in terms of investment duration.
- The potential to achieve a 100% loss if it goes wrong. Even with asset-backed investments, it is possible to lose it all. Again, this isn’t a big deal if you recognize this beforehand, and keep the risk at a manageable level.
- There is a guarantee by GRMA Pardus Wealth to insure against any loss. However, a guarantee is only as good as the person, or institution, giving that guarantee, and it is unclear how strong this protection is.
- If Pardus Fixed Income Bond doesn’t find enough Arbitrage opportunities, the returns aren’t realistic.
- With new informational I have received in 2023, it would appear that this bond is more risky than many originally thought.
- Pardus are late in paying bond holders. Whilst there is no certainty that this means the bond will collapse – the firm might come back from this – it isn’t a good sign.
Pardus Fixed Income Bond Review: Final Thoughts
The delays in payment are concerning.
You should probably only consider it if you are someone with high net worth and this investment is only a portion of a wider portfolio that you own.
Even then, on a risk-adjusted basis, there are far better and safer investments than Pardus.
With the new information coming in May/June about the lateness of payments, it is probably better to avoid this investment full stop.
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