The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content


(Comstock Images/)

How to find bond yields of up to 7.5% (minus the excess risk)

Not a figment of your imagination: Bond yields of 4 to 7.5 per cent.

They’re out there in the corporate bond world. To find them, keep an eye on the hot and cold stocks of the day. Two examples: Sherritt International on the hot side, and TransAlta Corp. on the cold.

TransAlta, a mid-size player in the utility sector, turned off investors recently by cutting its dividend to 18 cents a quarter from 29 cents and announcing a quarterly loss. The shares were down 6 per cent for the year to early April, a period in which the S&P/TSX composite index was up about 6 per cent. The dividend yield on TransAlta shares is still high at 5.7 per cent, which reflects lingering investor concern about the company.