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Talk Your Book: CLOs – The Providers of Leverage

Animal Spirits Podcast

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The Prepayment Rate Is Misunderstood

The loan index is around 93 cents on the dollar right now. If you're getting par dollars back, for the first five years of your CLO, you can go take those par dollars and reinvest at 93. The default rate is very interesting. The prepayment rate is misunderstood. And I have a theory that's held up my entire career: In credit, the rumor is always worse than the news.

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