Squeezing more juice
A growing number of experienced synthetic CDO investors in the region are looking at portfolios that combine CDS, ABS and CDO tranches as a means of compensating against the ongoing compression in investment grade credit spreads. Nick Sawyer reports
There’s still a steady stream of Asian investors opening their eyes to the synthetic collateralised debt obligation (CDO) market for the first time. Eighteen months ago, Asia’s CDO investors were largely concentrated among the big asset management firms, life insurance companies and banks in Japan, Hong Kong and Singapore. Now, dealers report first-time buying interest across the region, as more and more cash-rich Asian institutions get comfortable with the idea of synthetic portfolios
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