- Leveraged loans are more attractive than high-yield bonds because of their reduced call protection, the ECB's reduction of stimulus measures, and the expectation of rising rates, Todd Rothman, managing director of high yield and leveraged loan capital markets at JPMorgan (JPM -1.2%) Securities Plc tells Bloomberg.
- "Pricing on second lien loans and unsecured LBO bonds has converged, making the loan market a more attractive option of late for some issuers, especially given the reduced call protection on loans," he says.
- Rothman adds: "In times of volatility, the loan market is often more resilient to big moves in equities and general news flow and so we have yet to see some of the recent volatility in the bond market extend to loans."
- Previously: Leveraged loans outperform other asset classes as interest rates rise (Oct. 12)
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