What matters is what you do with it
CLO managers yearn for flexibility so they can take advantage when credit sells off. But it isn’t enough on its own: triple C-flex CLOs saw portfolios erode this year, while CBOs outperformed

We’re drifting apart
Everyone’s issuing US CLOs these days and it is tempting to believe the crowd of managers is blending into one. However, overall portfolio overlap has dropped to 37.7% across 2021 CLOs  

Arb work pays off
With day-one arbitrage alone delivering projected CLO cash-on-cash returns of 20-25%, 2021 may have been the best year ever for equity investors — at least until CLO spreads began to widen  

CLO managers show respect to their elders
Alongside lucrative new issues, managers also make time for refinancing and resetting old deals. Our data shows that, in 2021, mid-sized firms were the most effective at this balancing act

Still plenty more fish in the triple C

An alternative way of looking at CLO overlap
Analysing CLO collateral to look for overlap is critical for any CLO investor, but it is normally done either within a portfolio of CLOs or by bilaterally comparing two managers. In one of its latest research pieces, Moody’s Analytics has taken a different approach

Woah, we’re halfway there
Judging by the 2020 vintage, European CLO overlap is 50%. But varied approaches to holding bonds and the many loans managers turn down mean there are ways for issuers to outperform

CLOs wheel and deal as overlap increases
2020 CLOs are a different breed to any other vintage. But this cohort features an overlap of almost 40% as CLO issuers have been forced to focus almost entirely on secondary market loans

Waiting for afters
Day one arb remains important, but last year there were opportunities aplenty in the secondary market, which put the onus on printing CLOs and waiting for the day after non-call periods expired

Europe’s newcomers find ways to stand out
Last year’s new European CLO managers needed to provide something different for investors. In general, they’ve succeeded, with Capital Four having one of the smallest overlap figures in our data

Credit funds at a glance
A round-up of fundraising and people moves in credit

CSAM sees sun after nine years in shade

The ideal home for a loan

Market rallies as key CLO investor retreats

Budge up, more new managers are coming

We can’t hide it any longer, we’re tiering up
With the opening months of 2019 highlighting a clear class system among CLO managers, there has never been a better time to assess tiering. We find that timing, patience and luck all play a role

Not a bad time to try your hand at CLOs

It pays to eat your own cooking
CLO managers affiliated with PE firms buy extra debt from companies owned by those firms – and it seems to give them an advantage