Private credit lenders don’t have to put up with exotic assets and complex structures — they can choose SRTs
If rapid growth and diversification into exotic asset classes, complex structures, opaque valuations, PIK-ing, etc, all sound a bit 2008, there are alternatives. Private credit is not a monolith nor, in some parts, is it a crowded trade.

"Dispersion should manifest in potential fallen angel credits that are likely to proliferate"
IG and crossover names present a compelling alternative to shorting HY credit  

"All that remains is to thank all of you who have kept faith with my monthly confessions of insanity"
With the economic outlook now beyond a joke, Welshcake signs off amid denials he is actually a Welsh footballer  

“Pension fund managers should look to take advantage of a rare opportunity in corporate CDS”
The October sell-off in gilts highlights a glaring lack of exposure to CDS

"This ‘higher rates for longer’ saga is more like the 1920-21 depression than the 1970s high inflation era"
Sometimes you have to swallow your medicine and take a step back to go forwards

"Forget the World Cup, the macro-economic catastrophe cup has more well-matched contenders"
Government bonds are rallying in some quarters, but the odds are on more stress feeding into credit  

"Value persists in IG, but higher interest rates are a threat. Opening the synthetic toolbox can help"
Fiscal and monetary policy are pulling in opposite directions, but value in IG can be accessed via CDS and CSOs

"If anything is to be salvaged from the rest of 2022, the economy needs a hero — and quickly"
Something has gotta give as a recession looms in the US. Might it be energy?

"The shutdown of economies in the pandemic showed it’s better to suffer up front"
Rather than prolong the agony, central banks would be better off bunching their planned rate hikes into one    

"It’ll take something special to drag my attention away from Depp/Heard, but Jerome Powell could just do it"
It’s not easy letting go of the past, but May heralds the start of something new in credit

"Derivative longs versus cash corporate shorts looks attractive, especially if we see a market sell-off"
Technicals are keeping cash credit spreads tight, but as central banks reduce purchases there will be relative value opportunities

Points up front: "It’s all me, me, me"
A study last month by the University of Marburg found that narcissistic fund managers are up to 34% more likely to deviate from their advertised investment style, and they tend to underperform non-narcissists.

"The loan market is the septic tank for sub-single B LBO financing"
Portfolios of single name IG CDS are less complex and more liquid than CLOs

"Pivot points in curves may not stay where they have been historically"
CTAs and CSOs are changing the way credit curves move  

They said it: "The third term is Jinping’s legacy..."
... He does not care about near-term growth."

"If omicron paradoxically lowers the temperature of the market, that may be no bad thing"
The global economy is well protected against omicron — and a mild infection may be beneficial

"Growth in credit products lets investors express sector-specific views as dispersion ticks higher"
Investors can use ETFs, volatility dispersion swaps or even bond baskets to trade dispersion

Points up front: Definitely not an ex-parrot
One of the biggest credit fund launches last month was Arini, led by star credit trader Hamza Lemssouguer  

"If ESG funds only talk the talk, it is because investors, legislators and regulators don’t walk the walk"
Whatever an ESG fund means to you, it probably means something different to the next investor

"There are concerns about volatile sectors in high yield, but IG may be vulnerable to macro changes"
High yield has heavier exposure to energy and travel credits, but IG has more rate duration

"Pain is on the way: spreads are too tight, while compression and carry are done. But what if it's not?"
Welshcake reminds us that mid-cycle portfolio management is a funny old game  

"In the afternoon I awoke from a pile of willow leaves to discover we had created a Welsh ether-based token"
A localised crypto-currency boom and bust cycle teaches Welshcake (again) that everything becomes correlated in a downturn