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| bonds - should I take a huge loss now or gamble on bankruptcy |
netto |
02/06/06 |
A negligent investment advisor had me put an inheritance into approx. 150 Ford and 50 GM bonds.
Both companies' bonds are now junk bonds.
He's suggesting I sell them, take the HUGE loss, and invest in something investment grade, because he implies if these companies go bankrupt I'll lose everything. The bonds go out to 2028 and 2031.
I was under the impression that a bankruptcy wouldn't be as bad as taking a HUGE loss because bondholders have primary rights to company assets.
Also, what is the real likelihood of Ford and GM disappearing forever in a liquidation?
What happens if they file? Do they stop making coupon payments?
This is very scary, and really sucks. HELP!, please. |
Clarification/Follow-up by netto on 02/06/06 5:36 am:
Thanks for the response.
I don't understand what you mean by "that will bring you at least a 25% ROI per annum".
Can you please explain that to me?
Thanks again.
Clarification/Follow-up by kkemper on 02/06/06 8:54 am:
return on your investment.
not knowing what HIT you will take,
the hard money lending business
is the best biz anyone can be in IF
one is willing to hire an atty.
THAT is a mandatory component of
hard money lending.
I can teach you it.
kkemper1@mindspring.com
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