The leveraged loan asset class proved its mettle during a volatile February, outperforming other asset classes LCD tracks for its monthly leveraged finance analysis.
Indeed, February was the first month that leveraged loans – known as a bear-market asset due to its secured structure and floating-rate nature – have outperformed both high yield bonds and equities since October 2016.
Moreover, the last time loans posted an overall positive return for a month, while bonds and equities were in the red, was March 2015, nearly three years ago.
Obviously, February was a rare rough patch for equities; it was the first negative showing for the segment in 15 months, and featured a pair of 1,000-point (plus) drops. Both are records.
Year to date, loans have returned 1.16%, second only to equities, which have advanced 1.83% so far in 2018, despite a brutal February. – Staff reports
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