Fund performance
Good month for CLO funds sees six in top 10 as Axiom sets pace

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 can cope with downgrades again

You seem familiar
The overlap between European CLOs has risen to 51.6%, but the largest issuers are only slightly more aligned to their peers at 55.19% — so bonds are proving to be an important differentiator

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  

A fresh approach to loss distribution
Considering how cash balances change over time, loss distribution models can look very different to conventional thinking. So is your CLO’s pricing based on incorrect assumptions?  

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

Moving fast pays off for hedge funds
2020 was an up and down year in credit, and credit hedge fund managers had to move quickly to capture opportunities from the dislocations that inevitably opened up

Trading places: it can pay to bet on the little guy
It’s assumed investors know how good a CLO manager is by the rate at which they trade their way through a crisis. But this time fi ve small, nimble managers are outperforming the market

Loan slump brings managers closer
A 19% slide in new US loan volumes last year has left CLO managers with fewer options in the primary market, and portfolio overlap between US managers has increased to 35.3% on average

Credit pickers need luck to avoid OC trap
We know what you’re thinking: is my CLO failing its OC test? The truth is, in all this volatility, it can be hard to keep track, unless your deal has high quality liquid loans

 

Fund performance: Index tranche investors make it work from home
March brought a drastic drop in return figures as covid-19 swept across the globe, as Orchard tops the Creditflux performance tables

Budge up, more new managers are coming

Loan managers can start to be selective

New rules encourage growth in blossoming risk sharing market
Significant risk transfer deals have generally been issued towards the end of the year – but the first quarter of 2018 has opened with a flurry of deals across primary and secondary markets

Aircraft lessors: gathering clouds lead to talk of turbulence
Aircraft leasing companies have been cruising over the past two years as passenger numbers grew, but rising interest rates and trade tariff concerns are making some bondholders nervous

Drug makers: desperately seeking pain relief
With Teva’s profitable Copaxone being undermined by cheaper alternatives, the company is in need of a pick-me-up. By Euan Hagger

Managers predict skill will win out
We asked managers to predict the year ahead across a range of credit strategies. Overall, they had a positive outlook. By Grace Jennings-Edquist

US pensions look beyond equities
US pension funds dramatically lowered their allocations to equity in the decade ending in 2016 as they diversified into illiquid and alternative assets. By Grace Jennings-Edquist

Payday: Investors go for broke on regulatory bet
New regulations could seriously hamper US payday lenders – but bond holders are betting the rules won’t be enacted

Spotlight: Local exchange carriers - calling for rescue on the M&A hotline
Growth-starved US phone companies are seeing consolidation as the best way to improve performance

Leading fund: Lupus Alpha CLO Opportunity Notes I
Single-B CLO trades boost Lupus Alpha asset Management

Things aren’t always what they seem
Buy CLO triple As but don’t be fooled by diversity scores; take a look at credit index futures if you need liquidity; and watch out for quasi-mid market loans appearing in CLOs

US fashion stores: queueing up to exchange old debt
Fashionably loose covenants are allowing under-pressure retailers to turn expensive unsecured debt into senior notes