The Case for Investing in Floating-Rate Loans

The video discusses floating rate bonds, focusing on their attractive yields and the role of Libor as a base rate. It highlights the impact of M&A activity on loan issuance, using Warren Buffett's acquisition of Heinz as an example. The video also covers CLO formation, market demand, and compares the US and European markets. It concludes with an analysis of default rates and recovery expectations, emphasizing the senior and secured nature of these loans.

What are floating rate loans and how do they relate to US corporates?

Explain the significance of Libor in relation to floating rate loans.

What factors have driven issuance in the floating rate loan market?

Discuss the default rates for floating rate loans during the financial crisis compared to today.

What are the expected recovery rates on defaults for senior and secured loans?