Credit Markets Getting a 'Little Weary,' Z Capital CEO Says

The video discusses the current state of the silo market, highlighting its size and volatility. It addresses liquidity concerns, particularly in leveraged loans and high yield markets, and the challenges in market making due to reduced dealer participation. The need for transparency in trading is emphasized, with a focus on the impact of program trading and ETFs. Investment opportunities in lower-rated debt instruments are explored, along with a shift in the credit hierarchy towards leveraged loans. The video concludes with a discussion on the implications of these trends for market participants.

What is the approximate size of the silo market as discussed in the video?

• $1.2 trillion

• $900 billion

• $600 billion

• $300 billion

What is one of the main reasons for the decline in trading levels in the credit market?

• Decreasing interest rates

• Increasing interest rates

• Stable interest rates

• Fluctuating interest rates

What has been a significant change in the market-making landscape?

• Fluctuating dealer participation

• Stable dealer participation

• Decline in dealer participation

• Increase in dealer participation

What is a major concern in the market due to the lack of transparency?

• Increased market stability

• Decreased market size

• Increased market opacity

• Decreased market volatility

What is the current composition of leveraged loans versus high yield in balance sheets?

• 70% loans and 30% high yield

• 80% loans and 20% high yield

• 50% loans and 50% high yield

• 20% loans and 80% high yield

What is the implication of having a larger portion of senior debt on balance sheets?

• Lower defaults and recoveries

• Higher defaults and recoveries

• Higher defaults and lower recoveries

• Lower defaults and higher recoveries

Where does the speaker suggest might be the best place to be in the credit hierarchy?

• Equity part of the capital structure

• Middle part of the capital structure

• Senior part of the capital structure

• Junior part of the capital structure