CLOs: a growing market for investors seeking higher yields
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Collateralised Loan Obligations (CLOs) are managed portfolios of bank loans that have been securitised into different instruments of varying credit risk and thus varying credit ratings. CLOs are increasingly the linkage between the needs of smaller companies seeking financing and investors seeking higher yields.
Historically, most CLOs were privately placed into the hands of large institutional investors. But as the CLO market has grown, more opportunities for investors to include CLOs in their portfolios are emerging.
Our Market Overview explains why CLOs can be an attractive addition to a diverse portfolio of government and corporate bonds, and can complement other securitised holdings, such as mortgage-backed securities (MBS) and asset-backed securities (ABS).
These are the views of the author at the time of publication and may differ from the views of other individuals/teams at Janus Henderson Investors. Any securities, funds, sectors and indices mentioned within this article do not constitute or form part of any offer or solicitation to buy or sell them.
Past performance does not predict future returns. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested.
The information in this article does not qualify as an investment recommendation.
Please read the following important information regarding funds related to this article.
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