Wednesday 10 August 2022 by Jessica Rusit retail-product-offering Opinion,Commentary

The expansive service offering for retail investors

Since 2021 we have steadily expanded our retail product offering as new attractive opportunities present. Now with more than double the number of bonds on offer, and at even higher yields, it’s a rewarding time to be a retail client at FIIG. Here we discuss the broad product offering and the added resources that come with it.


With over 50 corporate bonds on offer, the product menu for retail clients has quickly grown in size, and handily coincided with the move higher in rates, offering attractive returns.

While wholesale clients typically have a wider investment menu, we have been expanding the retail offering to ensure this investor segment can also have adequate diversification and liquidity in portfolios.

Essentially, everyone is a retail investor unless they satisfy one of the requirements to be classified as a wholesale investor under the Corporations Act 2001. It’s a topic we often discuss as there are wider investing implications, and is further examined here.

Keeping on topic with retail investor feedback and demand, we have adjusted the product and service offering and here we further discuss these additions.

Bigger, better bond menu

With heightened market uncertainty, a trend we’ve seen this year is demand for investment grade rated bonds, strong high yielding credits and better diversification across maturities and bond structures. This has been reflected in the new bonds that have been added to the retail investment menu.

With a focus on defensive and investment grade bonds, we’ve included well-known household names that are now offering attractive returns over 5%. Where previously retail clients may have needed to ‘reach for yield’, this is more easily achieved with strong credits given the moves in rates.

We have added the investment grade NBN Co Limited 2030 maturity bond which is currently trading at a significant discount to face value, providing an attractive entry point, and indicatively yielding about 5.50% to maturity. Another addition is the Brisbane Airport 2030 maturity bond, paying a 4.50% fixed coupon providing a high running yield and indicatively available at a yield around 5.50% to maturity. Brisbane Airport’s 2030 bond has an investment grade credit rating.


There are around 50 investment grade corporate bonds to choose from on the expanded retail list, on top of semi-government and government bonds.

For added diversification and to further supplement income, we have added some (in our opinion) lower risk high yielding credits as well. These include Emeco’s 2026 maturity bond, which is senior secured and available at an indicative yield to maturity of about 7.40%. This bond also provides a higher income stream, paying a fixed 6.25% coupon. We also have ClearView’s floating rate note, with its first optional call date in 2025, and paying a quarterly coupon of 3month Bank Bill Swap Rate (BBSW) plus a margin of 6.00%.


With Environmental, Social, Governance (ESG) investing growing in popularity, we’ve added Lendlease’s 2027 and 2031 maturity green bonds to the menu. These bonds have a green certification which means the proceeds were used for projects that are environmentally responsible. Lendlease has increased its focus on sustainable developments, delivering Australia’s first 5-star rated green building under the Green Building Council of Australia’s rating system.


While previously corporate hybrids were mostly for wholesale investors, these types of instruments offer attractive returns and an added level of diversity to portfolios. Seeing a gap in the retail offering, we added the AusNet 2025 callable corporate hybrid to the menu. These instruments are mainly used as a way to support a company’s rating because rating agencies will consider the instrument to be 50% debt / 50% equity in their analysis. This is because of the terms of the instrument—in particular, the fact that they are long dated, interest can be deferred, and they are subordinated. In practice though, we see the default risk as broadly the same as senior debt, especially considering AusNet’s current credit profile.


We are continuously looking for opportunities to expand this product offering further, and generally would add three to five new bonds each month. All new bonds are subject to strict criteria and require approval from FIIG’s Credit Committee and Research team. These bonds are investment grade or otherwise selected unrated bonds from ASX-listed issuers approved by our Credit Committee. To see the full list of bonds available to retail investors, please click here.

Additional retail resources

While also expanding the product list, there have been additional resources made available to retail investors. The most notable of these is the Retail Sample Bond Portfolio, which was created to give retail investors an example of a balanced portfolio construct.

The portfolio is updated monthly, with commentary around the current market conditions, news in the retail space and strategy around the changes made to the portfolio sent to retail clients directly. This insightful information can help better educate clients on actively managing their own portfolios and things to consider when altering positions.

Currently, for the month of July, the Retail Sample Bond Portfolio is returning a yield to worst of 5.91% and has a 90% allocation to investment grade bonds. The below shows the further diversity and split of the current portfolio.


Further to this, we have added the full Retail Bond Menu to a dedicated webpage on the FIIG website, where retail clients are able to view company information and issuance details via each issuer’s Factsheet. These Factsheets are written by FIIG’s Credit Research Team and routinely updated.

Retail and wholesale clients alike are all assigned a Relationship Manager, who is there to assist clients with any of their bond investing requirements. This may include trading opportunities, reinvestment and upcoming maturity activity, corporate actions, new issuance opportunities (wholesale only) and general portfolio admin.

Additionally, this includes an annual portfolio review done through our Investment Strategy Team, along with adhoc portfolio reviews throughout the year. Not to mention monthly portfolio reporting, yearly reporting for accounting purposes and access to all documents and portfolio daily valuations via a FIIG client portal.

The FIIG client portal, known as MyFIIG, is undergoing a transformative upgrade, largely driven by client feedback around usability and information they’d like better access to. The new and improved version is currently in the testing phase and will be rolled out shortly.


With the many enhancements made to the retail service offering, there are many added benefits to being a retail client with FIIG. The product menu has further increased in size to provide better diversification and improved liquidity. Additional resources have been created to mirror the offering available to wholesale investors, such as the Sample Retail Portfolio and monthly portfolio updates direct to retail investors. To find out more on the advantages of a retail bond portfolio, please contact us.