The U.S. leveraged loan market has grown substantially in recent years with more and more loans bought by collateralized loan obligations (CLOs). Despite the increasing importance of U.S. CLOs, information on the holders of U.S. CLO securities is very limited. Information on who owns CLOs is, however, essential for quantifying the full exposures of investors to the leveraged loan market, as indirect holdings through CLOs represent a growing share of the total. This note fills part of that gap, providing (to our knowledge) the first breakdown of CLO investors by location and by investor type, combining data from the Treasury International Capital (TIC) system and the Securities Industry and Financial Markets Association (SIFMA). We find that most U.S. CLOs are held by U.S. investors and that the holdings are concentrated in insurance companies, mutual funds, and depository institutions. Foreign holdings are limited, as are holdings by hedge funds and other investment vehicles. ...

What can investors expect over the next three to five years? Dan Ivascyn, group CIO, and Joachim Fels, global economic advisor, discuss economic and market conditions and what investors should consider over the secular horizon. ...