BDC Fixed Income – which most of the time is as exciting as watching paint dry – is in the midst of a dramatic period of change.
First of all – and the primary focus of our weekly Market Recaps – the prices of existing issues are dropping.
We noted as much last week, and the phenomenon continued this week.
The median price of the now 38 different public BDC issues we track dropped to $25.21, from $25.29 and $25.35 two weeks before.
Topics: Loans, Middle Market, Analytics, BDC, market analytics, business development company, Fixed Income, News, bdc reporter
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Introducing the Middle Market Loan Advantage. The newest edition to AdvantageData’s suite of credit data products. The Middle Market Loan Advantage complements our syndicated loan and BDC Advantage modules. With [~4500**] middle market loans, the Middle Market Loan Advantage shines a bright light on this opaque market.
How do we do it? AdvantageData aggregates information from news sources, trading desks, buy and sell-side filings, and more.
Topics: Loans, Middle Market, Analytics, BDC, business development company, Valuation, Restructuring, Direct Lending, Investment Banks, Syndicated Bonds
An effective deal sourcing process is crucial to successful investing. Deal sourcing involves generating leads and managing relationships with intermediaries. Strategies for deal sourcing vary among firms. Some firms prefer to employ specialist teams while others prefer using in-house resources.
Regardless of a firm’s strategy, access to the proper tools and the right data are essential for effective deal sourcing. In March, Mergers & Acquisitions published an article that illustrated this concept with Michael Lewis’ book, Moneyball: The Art of Winning an Unfair Game. The book details how the Oakland Athletics baseball team successfully used statistics and analytics to their advantage. The same can be done in the world of deal sourcing.
Topics: Middle Market, Analytics, market analytics, Distressed Debt, Finance, Restructuring, Fixed Income
A pull-back in the BDC sector in this holiday shortened week, and a couple of unexpected developments.
To the BDC Reporter, though, the outlook remains the same.
In the semi-official, Labor Day shortened, first week back after the summer holidays, the BDC sector dropped back a little.
The UBS Exchange Traded Note with the ticker BDCS – which we use to measure the whole group – was off 1.0% to end at $20.79.
Likewise, the Wells Fargo BDC Index was down 1.05%.
The number of BDC stocks up in price, or at least unchanged, numbered just 14, versus 27 last week.
No BDC common stock increased more than 3.0% in price on the week, but three dropped by 3.0% or greater.
Topics: Middle Market, Analytics, BDC, business development company, Fixed Income, News
Duration risk has been a popular theme around buy-side firms as they look to incorporate low duration bonds into model portfolios to reduce interest rate sensitivity and increase liquidity. Typical bond indexes have an average duration of 5-7 years; this will create large outflow of assets in the upcoming quarters and increase popularity among individual securities.
Topics: Investment Grade, Analytics, bonds, Bonds Maturing, bond market, market analytics, Fixed Income, portfolio, interest rate, duration risk
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