I've had a cuppa and a ponder this morning....Chris is saying...

I've had a cuppa and a ponder this morning....

Chris is saying quite blunting that their reasoning for taking a CR slightly early and possibly at a slightly steeper discount is that they are speculating that there is a risk that financing will be disrupted soon by debt defaults in the Chinese property development industry. Now, I think this is unlikely, but no-one can deny it is a real risk and its more probable than wed like to assume. If this happens, NVA will not need to worry about running out of cash and possibly taking an even worse deal due to a tight credit market.

Interestingly, this could make NVA a decent hedge against such an event. If this crisis does happen in China and it spreads, the ASX and Australia in general will be brought to its knees. Most of my other investments will struggle. Maybe, just maybe, NVA will play the role of a hedge against such an event for the next 6 months or so....