- Direct lending (2)
- Emerging markets (1)
- High yield bonds (12)
- Investment grade credit (16)
- Structured credit (8)
- CLO (5)
- Distressed debt (2)
- Credit derivatives (remove)
- Leveraged loans (2)
Convexity pushes high yield bond basis to the forefront1 month ago
Compression had become the watchword of the market as Creditflux went to press, providing justification for high yield versus investment grade macro plays, wide-end long positioning and selective tight-end shorts. But the more important driver, say some relative value investors, was convexity
Zombies demand brain work from tranche traders1 month ago
Outperformance of junior tranches and underperformance of senior was the big theme in CDS index tranches going into December. But the picture began to change as Creditflux went to press
Little room to move in IG’s vice-like grip1 month ago
The absolute tightness of credit has left investment grade specialists a tough challenge to find value in the coming year, with neither scope for spread improvement nor encouragement to go short
Compression plays out as HY and European CLO double Bs outperform1 month ago
Investment grade and high yield credit spreads have tightened in sync with each other this week, but CDS and CLOs alike underline that the big theme over the past month has been compression between investment grade and high yield
IG and crossover indices converge while European CLO double Bs rally2 months ago
iTraxx Crossover is again outperforming Main today with the investment grade index widening 0.11bp to 52.56bp while the crossover index is 2.42bp tighter to 296.99bp. Meanwhile bank research signals that junior CLO tranches could benefit as investors look at covid industries through a different lense
CDS indices edge wider and positive skew opens as Pershing Square puts on new hedge2 months ago
Credit indices have widened a touch this week but they’re back in focus with reports that Pershing Square Capital Management, led by Bill Ackman, has this week used CDS indices to hedge parts of its equity portfolio
Credit rally rolls on as indices approach one-month tights2 months ago
CDS indices are approaching their mid-October tights as reality seeps in of a divided US government and, consequently, little chance of dramatic corporate tax increases. Yesterday, iTraxx Main led the way, tightening 5.3%, followed by CDX NA HY and CDX IG (both 4.5%) and iTraxx Crossover (2.8%)
US credit shakes off early jitters as CDX IG tightens 6.9%2 months ago
Credit spreads have reversed course yet again to join the rally in equities today. The Dow Jones Industrial Average up 2.5% today and credit is following with investment grade indices leading the way
Indices retrace wider as contested election scenario looms2 months ago
Credit is moving wider this morning as a contested US presidential election looms. This comes as incumbent Donald Trump threatened to go to the US Supreme Court in the early hours of this morning, citing election fraud and calling to stop votes being counted
Single names join rally as positive skews persist in Europe2 months ago
Single name CDS has joined the rally with European credit moving tighter this morning to continue the momentum from Monday. iTraxx Main is trading 2.1 basis tighter at 61.1bp today, according to IHS Markit, having shed 1.9bp yesterday. Similarly, iTraxx Crossover at 348.2bp has tightened 9.7bp today after tightening 9.1bp yesterday
European credit takes lockdown restrictions in its stride as indices tighten2 months ago
European credit spreads have held firm this morning despite the re-emergence of lockdown measures with the UK government announcing on Saturday that new restrictions will come into play on 5 November
Credit spreads wind back to February to bring shorts into focus3 months ago
The credit rally since April has opened up an opportunity to go short credit, say fund managers, with spreads back to where they were in late February
Fallen angels push off-the-run index 25bp wide of CDX IG3 months ago
A gap of over 25 basis points has formed between US investment grade CDX IG and its recently off-the-run predecessor series 34. At Credit Dimensions, Creditflux’s synthetic credit event, panellists highlighted a major shift in composition between index series that has opened up relative value plays between them
Investors get creative with new ways to trade the curve5 months ago
Credit index curve trading is gaining new features going into August, evidencing deeper liquidity for CDS strategies, but also that investors already have one eye on the upcoming September rolls.
Rampant technicals push cash and CDS in different directions5 months ago
Central bank interventions, primary market issuance and high yield defaults have conspired to create major distortions in credit performance, which sources say are ripe for opportunistic trading.
Bond selling pushes down Argentina CDS auction final price7 months ago
An auction on Friday to settle Argentina sovereign CDS returned a final price of 31.5 cents, three points lower than initial bidding due to a large physical settlement interest to sell bonds
‘Hoard credit’ says PM as markets swing9 months ago
As Creditflux went to press, the covid-19 death toll in Italy surged by 700 after two days of slowing, and the US congress agreed a $2 trillion stimulus package.
Tranche traders aim to navigate default risk while staying clear of coronavirus contagion10 months ago
The CDS market is navigating between two sources of risk for equity and mezzanine high yield index tranches. The default of US media company McClatchy has focused idiosyncratic concerns, while the spread of the coronavirus has stoked fears of a systemic sell-off.
IHS Markit mulls CDX EM growth and iTraxx ESG screen10 months ago
Increasing the portfolio size of CDX EM and consulting on an ethically-screened version of iTraxx Europe are among the projects index administrator IHS Markit has been working on ahead of the 20 March roll.
Covid-19 outbreak rattles carry traders10 months ago
The coronavirus panic hitting financials markets at the end of February has been a strong driver of relative value trades, with CDS underperforming both cash bonds and equity, while financial names felt the heat more than corporate borrowers as geographical risk came into play.
EIB buys mezzanine tranche in Commerzbank SRT11 months ago
Commerzbank has launched a €1.5 billion significant risk transfer with the European Investment Bank (EIB) announcing that it has invested in the mezzanine tranche of the securitisation
Correlation rise stokes mezz rally but adds to CSO woes11 months ago
Below the calm surface of the credit market, correlation has been churning and creating dislocations rich with reward for index tranche traders but complicating bespoke issuance, say sources.
Falling correlation reignites passion for index tranche trades1 year ago
Dispersion in the global corporate credit market is rekindling interest in correlation trading, with dealer sources reporting that a late surge lifted 2019 index tranche volumes to $250 billion.
Rising idiosyncratic risk leads to calls for high yield index tranche fix from traders1 year ago
As sources of funding dry up for the weakest borrowers in the credit market, some correlation traders are calling for an overhaul of CDX NA HY index tranches to make trades on wide-end dispersion more effective.
Five-year bespokes movement leads to managed CSO talks1 year ago
Longer dated synthetic bespoke tranche business could soon receive new impetus, with dealers and investors ramping up talks about re-establishing managed portfolios as a common feature of the CSO market.
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