Investor Diversity and Liquidity in the Secondary Loan Market
Abstract: Over the last two decades, the U.S. secondary loan market has evolved from a relatively sleepy market dominated by banks and insurance companies that trade only occasionally to a more active market comprising a diversified set of institutional investors, including collateralized loan obligations (CLOs), loan mutual funds, hedge funds, pension funds, brokers, and private equity firms. This shift resulted from the growing presence of these investors in the syndicates of corporate loans, as shown in the chart below. In 1991 the average term loan had just two different types of investors; by 2013 that number had grown to five.
JEL Classification: G1;
File(s): File format is text/html https://libertystreeteconomics.newyorkfed.org/2017/08/investor-diversity-and-liquidity-in-the-secondary-loan-market.html
Provider: Federal Reserve Bank of New York
Part of Series: Liberty Street Economics
Publication Date: 2017-08-09