Benefits of C.L.O. Equity Investments Over Private Equity and Private Debt

C.L.O. Equity provides immediate cash and quarterly distributions, in contrast to the 5-7 year waiting period for private equity and private debt. While private equity may face challenges in receiving expected distributions due to restrictive capital markets, C.L.O. Equity can offer steady returns. Although C.L.O. equity investors may see declines in distributions under certain conditions, the low default rates in the leveraged loan market and the ability of skilled C.L.O. managers to avoid over-leveraged companies present opportunities for attractive cash-on-cash returns. The recent interest rate spike has made over-leveraged companies' vulnerabilities apparent, allowing skilled C.L.O. managers to create portfolios while benefiting from negative market sentiment. This positions C.L.O. equity investments as an attractive option during liquidity constraints and market volatility.