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By Sandro Näf, CEO and Portfolio Manager, Capital Four Management and Mikkel Sckerl, Portfolio Manager, Capital Four Management
How to benefit from the attractive yields in European Leveraged Finance while taking on only moderate credit risk and limited interest rate risk? An unconstrained approach to European senior secured high yield and leveraged loans in the current market offers a yield of around 5%, a significant excess premium over and above the fundamental credit risk, with interest duration of less than 1 year.
The historically low interest rate environment has left many institutional investors reconsidering their asset allocation in search of yield. The established and growing leveraged finance market - high yield bonds and leveraged loans –...
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