Leveraged Loan Funds Saw Back-to-Back Inflows Last Week



CLO deals

According to S&P Capital IQ/LCD, six collateralized loan obligation (or CLO) deals worth $2.7 billion got priced last week. In the previous week, no CLO deals were priced. The YTD (year-to-date) CLO issuance stands at $34.7 billion.

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Leveraged loan funds saw inflows last week

According to data from Lipper, in the week ended August 10, 2016, leveraged loan funds saw inflows worth $96.4 million. In the previous week, inflows were $60.4 million. With inflows last week, total net outflows from leveraged loan funds stood at $5.9 billion until August 10, 2016.

In comparison, high-yield bond funds recorded inflows of $1.7 billion, and equity funds recorded outflows of $4.4 billion last week. Equity funds saw outflows of $4.4 billion in the previous week.

Senior loans are tracked by mutual funds such as the Oppenheimer Senior Floating Rate Fund – Class A (OOSAX) and the Fidelity Advisor Floating Rate High Income Fund – Class A (FFRAX). Investors can also get exposure to senior loans through ETFs such as the PowerShares Senior Loan ETF (BKLN) and the Highland/iBoxx Senior Loan ETF (SNLN).

Leveraged loans issuance slowed down last week. Western Digital (WDC), Wide Open West, Leslie’s Poolmart, and Polyconcept were some of the large issuers of leveraged loans last week.

Returns on leveraged loans

Returns on leveraged loans rose in the week ended August 12, 2016. The S&P/LSTA U.S. Leveraged Loan 100 Index rose 0.2% last week. The index has risen 7.4% YTD. The Oppenheimer Senior Floating Rate Fund – Class A (OOSAX), which provides exposure to senior loans, rose 0.1%, last week. OOSAX has risen 3.6% YTD.

The Highland/iBoxx Senior Loan ETF (SNLN), which also provides exposure to senior loans, rose 0.2% last week. It has risen 3.3% YTD.

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