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Unlocking Value: Demystifying CLOs

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5.31.2024
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Executive Summary

Overview of CLOs

Collateralized Loan Obligations (“CLOs”) offer investors an efficient vehicle to access the bank loan market. CLO equity provides above-average returns using term financing with high cash-on-cash returns. There are many structural features about CLOs that protect investors’ capital while benefiting all stakeholders. The appearance of complexity keeps many investors from allocating capital to CLOs, but proper analysis highlights how CLO structures create an efficient method for investors to have exposure to a portfolio of bank loans through market cycles.

Collateralized Loan Obligations (“CLOs”) offer investors an efficient vehicle to access the bank loan market. CLO equity provides above-average returns using term financing with high cash-on-cash returns. There are many structural features about CLOs that protect investors’ capital while benefiting all stakeholders. The appearance of complexity keeps many investors from allocating capital to CLOs, but proper analysis highlights how CLO structures create an efficient method for investors to have exposure to a portfolio of bank loans through market cycles.

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5.31.2024
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Overview of CLOs

Collateralized Loan Obligations (“CLOs”) offer investors an efficient vehicle to access the bank loan market. CLO equity provides above-average returns using term financing with high cash-on-cash returns. There are many structural features about CLOs that protect investors’ capital while benefiting all stakeholders. The appearance of complexity keeps many investors from allocating capital to CLOs, but proper analysis highlights how CLO structures create an efficient method for investors to have exposure to a portfolio of bank loans through market cycles.

Collateralized Loan Obligations (“CLOs”) offer investors an efficient vehicle to access the bank loan market. CLO equity provides above-average returns using term financing with high cash-on-cash returns. There are many structural features about CLOs that protect investors’ capital while benefiting all stakeholders. The appearance of complexity keeps many investors from allocating capital to CLOs, but proper analysis highlights how CLO structures create an efficient method for investors to have exposure to a portfolio of bank loans through market cycles.

Read Now

Read Now to Learn More (PDF)

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