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
Like a good beach novel, the BDC sector ended the summer in a satisfying manner.
The UBS Exchange Traded Note with the ticker BDCS – which is based on the Wells Fargo BDC Index – and which we use as a sector proxy, closed at $21.00.
That was 1.50% above the prior week’s end.
Topics: Loans, BDC, debt, business development company, Fixed Income, News
Another quiet week – as you might expect in August – for BDC common stocks.
The headline number – the price of the sector-wide UBS Exchange Traded Note with the ticker BDCS – was down. BDCS closed at $20.69, following a mostly downward sloping week.
Topics: Loans, Middle Market, BDC, market analytics, Fixed Income, portfolio, News
Going Nowhere
Often, after the completion of a BDC earnings season, we are witness to sharp price adjustments. After taking the health of nearly four dozen different funds in a very short period, analysts and investors often reach for the Buy or Sell button.This frequently results in a re-pricing of the entire sector, sometimes favorably and sometimes not. This week was a little different. Looking at the multiple data points that we do every week, we conclude that market participants did not do much in the way of re-thinking.
Topics: Middle Market, BDC, market analytics, Fixed Income, portfolio, News
Last month we shared a list of the top 10 BDC non-accruals based on first quarter 2018 SEC filings. Now that we are mid-way through August and second quarter filings are readily available, let’s take a fresh look at the first quarter’s worst performer.
Topics: BDC, First Lien, Non-accruals, Distressed Debt, Restructuring, Second Lien, Loan Default Rate, BDC Filings, Default Rate, Fixed Income, fair value, portfolio, download, News
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