Investments

One asset manager recalled the prelude to the global financial crisis and the 2001 dot-com bust, when companies that loaded up on debt when costs were low got hit with a steep bill years later.

The U.K. manager's assets have declined from peak of nearly $20 billion before a spate of 2020 losses.

The bond market's reenergized bulls may want to dial down their excitement, because their fortunes hinge on whether an abstract, almost elusive number, is as low as they assume.

U.S. leveraged loans are delivering some of the best returns in the fixed-income market this year, indicating that investors think any impending downturn could be slow to come and not particularly severe.

A decade after its historic bankruptcy, the Motor City is tapping the municipal bond market for $100 million. The funds will mostly go toward programs to help revive struggling neighborhoods.

The Securities and Exchange Commission and the Federal Reserve have questioned prime brokers about the basis trade as well.

Junior tranches are at the heart of the debate around whether the capital that insurers currently hold against CLOs is sufficient, and the NAIC may soon impose stiffer risk-based capital requirements.

Schwab Asset Management is seeking to draw investors to its high-yield bond exchange-traded fund with one of the lowest fees in the industry, even as rising rates and default fears rattle the asset class.

Resetting allows CLOs to essentially cut the costs at which they borrow, leaving more money for holders of the riskiest and highest-returning part of the structure, the equity portion, after other note holders have been paid.

Nearly a quarter of respondents in North America this year said sustainability is a primary or secondary objective, compared to 37% who said the same last year, according to an HSBC survey of professionals in roles related to ESG decision making.

Almost $350 billion was raised from green bond sales and loan arrangements in the first half of this year, compared with less than $235 billion of oil, gas and coal-related financing.

In their latest assessment of the bond market outlook, Morgan Stanley strategists are challenging the former head of the Federal Reserve Bank of New York's view that losses are likely to deepen.

The loans coming across their desks include car debt and personal loans, from consumer lenders including LendingPoint, Best Egg and Upstart Holdings Inc., as well as regional banks.

Partners in ABS practice also discuss how CLOs face final bridge to cross as Libor transition approaches the finish line.

The market for wagers on the outlook for central bank policy shows traders now expect the benchmark rate to peak in September, instead of July.

They are bullish on equities in Japan, Taiwan and South Korea and recommend an overweight position in developed-market government bonds, including long-dated Treasuries

CLO spreads should tighten toward year-end, easing arbitrage challenges. Meanwhile investors will be challenged to calibrate the recovery rate, says Pratik Gupta.

The Treasury's cash balance fell to just $37.4 billion on Tuesday, according to data published Wednesday. That more that reverses the previous day's bounceback.

One case found that simply defining the investment in the new debt as an allowable transaction was helpful, but new indenture language to facilitate participation provides CLOs with little benefit.

Federal officials have questioned prime brokers about leveraged trading in government bonds by their fast-money clients.