Israel Bonds

rembrandt

Full time employment: Posting here.
Joined
Aug 11, 2012
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15 Year bond pays 5.76%. Not bad.

Israel Bonds Current Rates​

Valid 11/01/2024 - 11/14/2024​

JUBILEE BONDS
Twelfth Series
PROSPECTUSMinimum Subscription: $25,000 and increments of $5,000.
BONDRATEMATURITY DATE
2-Year4.35%November 01, 2026
3-Year4.65%November 01, 2027
5-Year5.03%November 01, 2029
10-Year5.51%November 01, 2034
15-Year5.76%November 01, 2039
  • Issued on the 1st and 15th of each month.
  • Interest paid every May 1st and November 1st.
  • 1-Year Jubilee Bonds are not offered in this sales period
 
I'm surprised that yields are that low given the growth of the BDS movement and the highly inflationary government spending on the war(s). Maybe the market expects the diaspora to bail the country out. Irrespective of the political issue(s) I wouldn't consider these as conservative investments.
 
Are these in US dollars?
Interest will be paid every May 1 and November 1, and upon maturity, except that for bonds issued on April 15 and October 15 of each year, the first interest payment will be made on the second interest payment date following their Issue Date. When the bonds mature, you will receive the face amount of the bonds in U.S. currency.
 
S-12 of prospectus

Principal and interest payments will be made in U.S. dollars and will be subject to exchange rate
risks and exchange controls affecting investors whose principal currency is not U.S. dollars.

I missed the "not"... But relevant for our Canadian neighbors. My reading comprehension was always bad in school testing...

Still not interested as you can't sell on a secondary market...
 
Why would you sell a Savings Bond/ CD instrument? This isn’t like a treasury bond.
If you want to take the risk without the ability to exit for obvious risks in the world currently, then yes, it's like a Treasury. I glanced more at the S-12&13 and lots to consider for a couple of points of interest.
 
FYI, These are already in the Vanguard Total Bond Market Index Fund:

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Why would you sell a Savings Bond/ CD instrument? This isn’t like a treasury bond.
My thinking too. Would be monies that you are willing to tie up for the length of maturity 100%. Perhaps the concept of no selling could be considered like a MYGA.
 
I would not consider it a conservative investment. Israel is a small country that is probably the single most likely place in the world to be on the receiving end of a nuclear weapon. They are now embroiled in a regional war that seems likely to get worse before it gets better. And as strong/resilient as the country is, other, much larger countries may decide to use it as a pawn in wider geopolitics.

I don’t think the risk premium is high enough.

YMMV
 
I also was surprised by how close the rate was to US Treasuries of the same duration. Surprised as in "nowhere near high enough" :D
 
I had a bond issued by the State of Israel at one point. It was guaranteed by the US government like it was as Agency Bond.
It’s yield was comparable to an agency but it wasn’t callable.

Are these USA backed? (PDF wouldn’t open for me) That would explain the rate.
 
For many who buy State of Israel bond issues, and have done so multiple times, the T's and C's mentioned above, the yield, and the risk, are secondary considerations.

It is not always about money.
 
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15 Year went up to 6.11%
Home > Bonds & Rates > Current Rates

Israel Bonds Current Rates​

Valid 01/15/2025 - 01/31/2025​

JUBILEE BONDS
Twelfth Series
PROSPECTUSMinimum Subscription: $25,000 and increments of $5,000.

BONDRATEMATURITY DATE
2-Year4.63%February 01, 2027
3-Year5.07%February 01, 2028
5-Year5.53%February 01, 2030
10-Year5.86%February 01, 2035
15-Year6.11%February 01, 2040
 
There are other reasons why some people might, or do, invest in State of Israel bonds beyond maximizing ROI or incurring various risk factors.
 
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