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Following further slowdown in inflation expectations, real rates have surged in the last three months and are now exceeding 2%. The positive long- and short-term real rates benefit fixed income investors across entire spectrum of credit market sectors. Due to relatively tight investment grade credit spreads, real yields of 3.5% on IG corporates only slightly […]
Increase in US real rates supports credit investments Read More »
At 430 bps, the spreads on BBB-rated US CLOs remain well above BBB bonds (140 bps) and even split-rated BBB/BB loans (270 bps) – see chart 10 above for overall CLO yield context. There are various reasons for this anomaly, including higher flows-driven volatility. From the pure credit loss-perspective, the BBB CLO tranches are extremely
Spreads on BBB CLOs remain high despite structural strengths Read More »
While increasing risk free rates have been the key drivers of rising yields and returns of syndicated loans during the last twelve months, the credit spreads, represented as discount margins over floating benchmark rate, have exhibited significant volatility during the same period. Single B-rated loans have been widening disproportionately, with increasing risk premia sensitivity evident
Syndicated loans discount margins remain elevated Read More »
Global stock and bond markets closed the first months of the year on a positive note. A real trend reversal could be observed: Last year’s losers, such as growth stocks or high yield, became the current high flyers in 2023. The turnaround in the markets was also reflected in the alternative universe. Find out which
Hedge Funds Review & Outlook 07/2023 Read More »
While increasing risk free rates have been the key drivers of rising yields and returns of syndicated loans during the last twelve months, the credit spreads, represented as discount margins over floating benchmark rate, have exhibited significant volatility during the same period. Single B-rated loans have been widening disproportionately, with increasing risk premia sensitivity evident
Syndicated loans discount margins are still elevated Read More »
Yields on first lien private loans have reached their highest levels since 2008 during the Great Financial Crisis and remain attractive relative to broader private loan market as well. For illustration, first lien yields on one of Alpinum’s representative portfolio in USD are now exceeding 11% p.a. (or ~7.5% hedged in CHF). Rising risk free
First Lien Private Loans at most attractive levels since 2008 Read More »
Despite the negative turn in the economic cycle, the presence of a resilient consumer base and favourable government policies have mitigated the risk of an immediate recession and minimized the potential for a severe economic downturn. The Federal Reserve (Fed) paused on interest rate hikes, maintaining a hawkish stance, as the US experienced encouraging growth
Q3 2023 – Quarterly Investment Letter Read More »
Following interest rate hikes and considering growing evidence that inflation expectations had peaked, the short-term real rates have been recovering from their record lows. At the same time, the 5-year breakeven inflation data suggest stabilization towards 2% range. The recovery of real rates is benefiting fixed income investors. When considering the longer term 5-year breakeven
Recovering US real rates bring opportunities to credit investors Read More »
Since the start of the FED’s tightening, credit spreads on residential mortgage-backed securities (MBS) have been widening significantly. For example, the credit spreads on junior B1 and B2 tranches of Credit Risk Transfer notes (CRT) have doubled since their 2017 lows. These junior CRT tranches absorb initial losses on diversified US agency residential mortgage-backed pools
MBS credit spreads have been widening significantly Read More »
Die Schweiz gilt als einer der globalen Hauptstandorte der Private Market Industrie. Das erforderliche Know-how von weltweit anerkannten Anbietern und lokalen Spezialisten liegt somit für Investoren direkt vor der Haustüre. Umso mehr freut es uns, mit dem Beitrag «Private Debt in steigendem Zinsumfeld» eine interessante Publikation zum aktuellen SECA-Booklet 18 – Anlageklasse Private Debt beigesteuert
Private Debt in steigendem Zinsumfeld | SECA Booklet 18 Read More »
