Mystery Vanke Bond Trade Unsettles Investors as Redemption Nears

A mysterious trade of a China Vanke Co. bond at a deep discount briefly jolted credit markets just two days before the distressed developer’s anticipated move to redeem the note, in another reminder of the fragile mood among investors.

The trade, consisting of several consecutive transactions of Vanke’s 4.11% yuan bond, was completed around 82.7 yuan ($11.6) at about 9:30 a.m. Beijing time Tuesday, according to data from the Shenzhen Stock Exchange. The price, which was well below the 99.9 yuan level at Monday’s close, would translate into an annualized yield of 3,650% if Vanke exercises a call option to buy back the bond on Nov. 13, according to several credit traders.