Go ‘overweight’ in CLOs next year, says BofA
Market participants should take advantage of any spread widening in CLOs between now and year end, said Bank of America research analysts, as they predict that bonds throughout the capital stack will rally in 2020.
BofA is recommending going overweight CLOs next year, and said it expects 10bp of spread tightening at the triple-A level and 100bp-300bp of tightening in double and single-Bs.“On the back of positive tailwinds in the broader economy, rates and loan market, we are going overweight on CLOs ...
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