How many CLOs will be reset?
Tightening liability spreads aren’t just driving record new CLO issuance this year — they’re also triggering a wave of resets and refinancings in the US, especially for broadly syndicated CLOs

How many CLOs will be called this year?
Most CLOs are called when loan market prices are high. Distributions and equity NAV are also important, and they suggest that over 30 2017 and 2018 deals are now ripe for redemption

Ask the market where spreads are heading
Nothing brings the CLO market together like a good moan about the state of the arb. But according to our data, the arbitrage for new-issue US CLOs has remained in the same range for years. 

European CLOs win out against US deals
Last month, our analysis explored the performance of US CLOs that were previously reset. We found that they delivered higher distributions than deals which weren’t reset, with the exception of the 2017 and 2018 vintages (Creditflux September 2023 — Do resets help CLOs perform better?). This article expands that analysis to the European market, and compares the performance of US BSL and EU CLO equity tranches.

Do resets help CLOs perform better?
As the market for CLO resets opens, we look at the performance of deals that were previously reset, and find they soon deliver higher distributions than those deals that were not reset

Question your assumptions
Valuing CLO paper is complicated, and loan prepayments are one of the trickiest parts. When pricing a new issue CLO, the market generally assumes that 15-20% of loans will prepay their principal annually. This prepayment rate is important because it essentially determines the pace at which a CLO’s rated debt is paid off after the reinvestment period, when the CLO pays down its own principal.

Heading tighter into uncertainty
Tightening loan spreads are making the job of a CLO manager harder in both the US and Europe. But credit volatility could be on the horizon

Rethinking credit value
CLO seniors, cash-CDS basis and tranche shorts were some of bank researchers' top picks last month, as volatility sends analysts back to the drawing board

Your credit research picks of 2015
The most read Creditflux news articles last year about research and strategy ranged across the biggest topics in credit, from CLO retention to how shorts affect dealer inventory figures

Impact of downgrades is not priced in
Barclays warned last month that record numbers of companies may become fallen angels in 2016. Here's our summary of that report and eight others that caught our eye

Finding value amid volatility
Researchers and strategists had plenty of tips last month about where to find opportunities in volatile credit markets. We pick 10 of the most eye-catching findings