tag:blogger.com,1999:blog-6321089372587128676.post3764259137088799624..comments2023-10-17T10:01:00.917-04:00Comments on Distressed Debt Investing: Lehman Brothers BankruptcyUnknownnoreply@blogger.comBlogger4125tag:blogger.com,1999:blog-6321089372587128676.post-85037721337237422102011-07-18T16:06:21.933-04:002011-07-18T16:06:21.933-04:00Now, I'm sorry if this is completely basic, bu...Now, I'm sorry if this is completely basic, but is there a way of finding a theoretical price for these bonds? is that just the recovery, or should the interest 'lost' also be factored in?<br /><br />And what about a distressed bond before bankruptcy? is the theoretical price then similarly yielding bond x expected amount recovered in bankruptcy? Or do you also factor in how long it will take to get your cash back?<br /><br />Thank you so much in advance!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-44999987985657800932011-07-18T07:36:13.845-04:002011-07-18T07:36:13.845-04:00But like you said the recovery as per the plan is ...But like you said the recovery as per the plan is approx 21% of the face value for Senior Unsecured and these are trading at 23-26 cents in a Dollar, suggesting there is little upside to the current prices. Unless the recoveries are higher than expected.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-32448529406401075532011-07-18T02:30:59.441-04:002011-07-18T02:30:59.441-04:00It means if the market crashes, you'll still g...It means if the market crashes, you'll still get a decent return from splitting the Lehman asset pie.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-77814164097739690112011-07-16T00:37:28.626-04:002011-07-16T00:37:28.626-04:00"another aspect of this case was that A LOT o..."another aspect of this case was that A LOT of capital could be put to work with very little correlation to the market with very little downside. And that is still probably the case."<br /><br />Can you please explain what you mean by this paragraph? Thanks.<br /><br />An interesting article.Anonymousnoreply@blogger.com