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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: robert b furman who wrote (55004)	3/4/2015 12:50:45 PM
From: E_K_S	Read Replies (1) \| Respond to of 78652

Correlation of Distressed Bonds and Oil? It's more so w/ the price of the common stock and their assets, earnings, future outlook and cost of debt. The price of Oil and NG goes into that calculation but at some point these bonds (IMO) got way over sold. Both MHR and SFY are more gassy producers so revenues s/d be impacted by NG prices rather than the price of crude. What I have noticed that for the bonds, trades of $1mln or more of face value seem to be Buy's recently where in January these size lots were sells. There also could be some arbitrage with the prefereds (for MHR) as the interest rates for the bonds were higher than some of the preferreds. That difference has now righted it's self as the senior debt should have a lower interest rate. So, there are a lot of market factor that seem to affect price. Also, both companies reported pretty good earnings and that has lead to higher bond prices. This may/could change as hedges run out and/or commodity prices remain at lows. EKS