Asset-Backed Securities Quarterly Update – January 2022
TwentyFour Partner and Portfolio Manager, Douglas Charleston, explains how ABS markets have performed in Q4 2021 and provides his outlook for the new year.
Insights Topic
CLOs
European ABS: Five things to expect in 2022
If 2021 was a bad year for global bond returns, it follows there were few natural shelters to be found within fixed income from the brunt of inflation and rates-driven volatility; the Barclays Global Aggregate Index (a widely used broad measure of bond performance) returned -4.7% in USD terms, while European investment grade credit returned -1.1% despite credit spreads tightening over the course of the year.
Three strategies for beating inflation with bonds
Inflation was the dominant theme across financial markets in 2021, and we think it is likely to be a big driver of returns again in 2022.
European ABS: Five things to expect in 2022
With inflation and rate hikes dominating market discourse, we expect floating rate assets such as ABS and CLOs to benefit from increasing demand in 2022.
Specialist lenders lead stacked pipeline in ABS
The first two trading weeks of the year are coming to an end and unlike previous years they have been packed with activity.
Euro CLOs a top pick for 2022
Markets have clearly experienced some periods of volatility this year, and while European CLOs haven’t been immune to this, both fundamentals and prices have been remarkably stable.
Where is the yield in floating rate bonds?
With floating rate assets likely to be high on investors’ shopping lists for 2022, Doug Charleston looks at the floating rate options across fixed income and highlights the highest yielding opportunities.
The Rodney Blog 2022: Policy, economy and markets must converge
What we are currently experiencing is a disconnect between monetary policy, the economy and the markets, a disconnect that in our view will struggle to survive much longer.
European ABS and CLOs Resilient Amid Volatility
After a mixed start to Q4 for risk assets, Elena Rinaldi examines how European ABS and CLO assets have fared so far in Q4 and the factors currently affecting both markets.
BoE Rate Hikes Would Be Music to ABS Ears
Let’s not forget that the BoE dropped rates from 0.75% right down to 0.1% at the start of the COVID-19 pandemic back in March 2020, having only managed to put through two hikes in 2017 and 2018. It has changed course sharply before.
How do ABS and CLO Investors Trade Bonds?
BWIC – or bids wanted in competition – lists, are a unique characteristic of the ABS and CLO markets, where they are widely used in secondary trading when investors are looking to sell bonds.
CLO Metrics continue to improve
Based on these metrics, the picture seems rosy, and credit performance looks set to continue through the second half of the year should the main drivers of the recovery remain intact.