CLOs

Fixed rate bond yields may have climbed as markets priced in higher interest rates, but both existing and new investors in floating rate bonds have more to gain as central banks keep hiking, says Pauline Quirin

Douglas Charleston looks at the development of the European ABS market in the second quarter of 2022 and explains what this could mean for investors going forward.

With yields on B rated CLO bonds now as high as 18%, Elena Rinaldi looks at various scenarios for corporate default rates and questions why investors are overshooting even the most pessimistic scenarios.

European ABS and CLOs had a turbulent Q2 as broader macro headwinds sparked heavy selling, but investors have made good use of direct trading to pick up bonds at prices not seen since Europe’s sovereign debt crisis.

Aza Teeuwen explains how market moves have impacted BB CLOs and looks at historic trends analysing their behaviour during crisis scenarios.

After two COVID-hit years last week the European ABS market decamped once again to Barcelona for the 26th annual AFME & IMN Global ABS conference.

In fast-moving markets there is no perfect time to provide an update on valuations.

We can debate whether the European Central Bank is behind the curve or not, but Christine Lagarde says rates will be in non-negative territory by September.

As inflation continues to outstay its welcome in the global economy, we have previously discussed the impact of rising input costs on corporates and how crucial pricing power can be in such a challenging environment.

Collateralised Loan Obligations, or CLOs, are bond instruments issued to fund a specific pool of loans, typically senior secured or ‘leveraged’ loans, to companies.

TwentyFour Portfolio Manager, Elena Rinaldi, explains how European ABS markets behaved in Q1 2022 and provides her outlook for the year ahead.

As 2021 wore on we became increasingly concerned that the disconnect between asset prices, economic fundamentals and monetary policy was becoming more acute.