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Noble, you still haven't convinced me

18 August 2015 by pdonnat

NOBLSP (Noble Group Limited), the commodity trader based in HK, failed to convince despite a long presentation to investors. The stock is down 8% today and the CDS price is 100bps wider, close to 10% per annum. The company has 2BUSD market capitalization for 6BUSD of debt. All is about the fair value gains on long dated contracts in their accounts. The fair valuation method is questionable. Spending hours to explain how it works causes more harm than good.

The CDS price is not fair, it is real. They are interested buyers of credit protection.