Sultanate of Oman Government Bond Pay Check is coming up

In the last month I have added a new position to my portfolio that is Sultanate of Oman Government Bond. Check out this line as you see in Interactive Brokers screen.

This can be translated as;

OM = Sultanate of Oman Government

Coupon Rate = 6.5%

Maturity Date = 08 March 2047

Position Value = $400K

Last Traded Price = $98.0880

This government bond pays out the coupon every 6 months. You can figure out pay date from the maturity date 08 March and 08 September. Payment amount is going to be Position Value * Coupon Rate divided by two payments annually. In my case $400K * 6.5% =  $26K then divide by two that is $13K every 6 months exactly. Note that the trading price does not matter for this kind of fixed income. Price only matters when you trade the bond.

I love my bonds! Bonds are good for people like me trying to achieve FIRE and get a regular pay check to live off just like a salary. Last week was very volatile in the stock market S&P500 index dropped 12% in one week due to concerns around Corona virus. If you are invested in the Index Funds like most people do then you have to sell some of your shares to get a pay check. This is a really difficult and stressful time trying to decide which price to sell them. Your number of share will continually decrease as the time goes on.

90% of my portfolio are in Emerging Market Government bonds with an average of 10% return. So despite the turmoil in the market I was relaxed because I knew exactly when I would get my coupon payment (08 Mar) and the amount that is also fixed. You should also receive a corporate message like the one below.

I only care about the index volatility for 10% of my portfolio with The Money Making Machine stocks. For such a sharp decline my stocks for the week would be impacted badly. As I back tested my strategy over 2, 5, 10, 20 years and found out that it did beat the index S&P500 therefore I am not worried for some weekly losses. The Money Making Machine strategy has a winning ratio of 63% so it is absolutely normal to lose some weeks. Losing is part of the game! Get used to it to become a successful investor.

How can you check when you will be paid from your fixed income assets?

I am trading with Interactive Brokers so I will show you how to access this information through Interactive Brokers web portal. From the main menu click on Portfolio Analyst

Then go to Reports tab and choose Month to Date Report in PDF format as seen in the image below.

In the downloaded report you will find a section called “Projected Income“. If you invested in bonds like me this means your pay check is going to be distributed in months as shown in the graph. March is the best month for my income as Oman and Costa Rica bonds are paying out in this month.

 

My total coupon payments are adding up to $70766 annually. My target for FIRE is $10K a month that is $120K annually. Note that I do not receive any payment on Apr, May, June, Oct, Nov, Dec. I am trying to find a bond that matures in May so I get paid every two months.

 

 

 

 

 

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