This week we chat with Stephanie Link. Stephanie is a managing director and equity portfolio manager for TIAA Global Asset Management. She manages large-cap equities primarily based in the US. She is also a CNBC contributor and appears regularly on Closing Bell and Halftime. The Lead Left: Stephanie, what do you see when you look…
Steady volume of funds geared toward US lower middle market
Since 2013, a significant uptick in the number of private equity funds geared toward the lower middle market—sized between $100 million and $500 million, according to PitchBook methodology—has occurred. 2013 was undoubtedly a peak, with 107 closed in that year alone, but the volume has hardly slackened much since, as 94 vehicles were wrapped in 2016. One driver of this trend has undoubtedly been the entrance of new fund managers into the market...
Credit Strategies Start 2017 with Positive Performance in January
Preqin research finds that credit strategies have maintained their positive performance from 2016, with a strong start to the year through January 2017, as investor and fund manager confidence in the strategy grows.
Credit strategies were the second best performing leading hedge fund strategy last year with annual returns of 8.50%, well outstripping the Preqin All-Strategies Hedge Fund benchmark (7.40%)...
Contact: Blake Udland Blake.Udland@spglobal.com
Covenant-lite volume will likely hit another record high in 1Q17
Covenant-lite loan volume has already reached US$90 bn in 1Q17 with two more months still left to go this quarter. With another US$35bn still in process, 1Q17 will likely be a brand new record high for covenant-lite issuance. Covy-lite volume had just hit a brand new record high last quarter at US$128bn, smashing the previous record set in 1Q14. These robust volumes are largely taking place during big refinancing waves like in the current environment...
The red line in the chart is the *Cliffwater Direct Lending Index (CDLI) current yield, which is based on the investment income of the underlying assets held by public and private BDCs. BDCs invest in middle market companies, and the Index comprises of more than 6000 middle market loans - with 56% senior debt, 31% subordinate debt and 9% equity. The blue line displays the BofA Merrill Lynch US High Yield, which tracks the performance of USD denominated below investment grade corporate debt publically issued in the US. Increase in high yield depicts dislocations in market, pricing in higher risk...
Source: SPP Capital Partners Contact: Stefan Shaffer stefan@sppcapital.com
Industry Average: Free & Clear Incremental Tranche / EBITDA (LTM)
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