CLO Investing

Collateralized Loan Obligations (CLOs) were left for dead after the Global Financial Crisis (GFC) of 2008-2009. Since then, CLOs have made a surprising comeback. Their popularity among investors is partially the result of impressive CLO performance during the GFC and beyond. CLO notes issued before the GFC did not have material defaults, and many CLO equity securities issued prior to the GFC ended up with annualized returns above 20%. Today the CLO market has over $1 trillion in assets under management and has replaced banks as the largest lender to private equity-backed companies.

CLO Investing: With an Emphasis on CLO Equity & BB Notes describes CLOs in detail, emphasizing the securities with the highest risk and reward potential, CLO BB notes and equity. The readers of this textbook will learn the characteristics of the CLO’s leveraged loans, financing structure, payment rules and tests, and historical returns. As CLOs are gaining in popularity, investment professionals of all varieties will benefit from author Shiloh Bates’s meticulous understanding of this unique market and the strategies for successfully investing in it.

About the Author

Shiloh Bates, CFA®, has spent his career in the collateralized loan obligation (CLO) market, working for CLO managers and investing in CLO securities. Currently the Chief Investment Officer of Flat Rock Global, he is a frequent panelist at CLO conferences. A life-long learner, Shiloh has a BA from Virginia Tech in political science, an MA in public policy from Harvard University, an MA in financial mathematics from the University of Chicago, and an MA in statistics from Columbia University.