Cloud 9fin Canyon Partners’ Sheffield and Barzideh talk opportunistic credit
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May 15, 2025 Jonathan Barzideh, co-head of opportunistic credit at Canyon Partners, specializes in distressed debt and structured credit. He discusses how economic uncertainty and U.S. tariff policies shape investment strategies. The conversation highlights innovative solutions in over-leveraged markets and reveals the adaptability of opportunistic credit in various sectors. Barzideh also explores how the structured credit market presents unique opportunities and emphasizes the importance of understanding company fundamentals in credit management.
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Impact of Rising Rates
- Rapid rate increases exposed unsustainable capital structures overly reliant on low rates.
- Many leveraged companies struggled with liquidity due to unpreparedness for this higher rate environment.
Uncertainty Creates Credit Opportunities
- Uncertainty generally creates opportunity in credit, even if it pressures equity.
- Interest rate hikes and inflation since 2022 have fundamentally changed the investing environment.
Flexible Opportunistic Credit Strategy
- Canyon's opportunistic credit strategy is highly flexible and spans healthy credits to distressed debt.
- They target mid to high teens returns investing across corporates, real estate, and structured products.