The fourth quarter of 2018 ended on a much more sour note than it began, as European leveraged loan prices went from holding steady in October to taking a plunge in November, followed by an even bigger sell-off in December.
In the last month of the year the S&P European Leveraged Loan Index (ELLI) lost 0.74%, which is the worst monthly performance in almost three years, following a 0.52% loss in November and a coupon-clipping positive 0.33% return in October.
Despite this decidedly poor showing, the European loan segment outperformed its U.S. counterpart, which returned a scant 0.44% in 2018, after a brutal 2.54% slide in December, according to the S&P/LSTA Index.
European leveraged loans returned 1.41% in 2018, besting not only the U.S. loan segment, but significantly ahead of European high yield bond returns, and equities.
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