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Author Topic: HY Corporate Credit Meltdown

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HY Corporate Credit Meltdown
OP: December 14, 2015, 12:00:00 AM
This is what's going on at HY credit market at the moment. I think P2P is classified as HY or structured credit. Interesting to see if the fear will spread into this space. Since there is no secondary market, don't think there will be a sell off. But interesting to see if risk appetite of institutional guys will shrink going forward. 

http://www.bloomberg.com/news/articles/2015-12-14/asian-bond-risk-surges-to-two-month-high-on-contagion-concerns
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t
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HY Corporate Credit Meltdown
#1: December 15, 2015, 12:00:00 AM
From my personal experience, I can say that in the past month I have had to discount notes more than usual to get distressed notes to sell on Folio.
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HY Corporate Credit Meltdown
#3: December 15, 2015, 12:00:00 AM
I don't put P2P loans and high yield bonds in the same category.

I believe the dip in junk bonds will drive more investors to P2P loans.
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HY Corporate Credit Meltdown
#5: December 16, 2015, 12:00:00 AM
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HY Corporate Credit Meltdown
#7: December 17, 2015, 12:00:00 AM
LC coupon rate is a combination of risk-free interest rate + credit spread. Credit spread is notoriously volatile. In the current environment, 25bp risk-free interest rate bump is negligible for B grade or higher since their coupon rate is mainly credit spread. However, LC may have to increase A1-A3 grade rate to make it competitive when fed rate increases further
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