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This week, we communicate with Armen Panossian, managing director and head of performing credit score at Oaktree Capital Administration, which has $179 billion in property beneath administration. He oversees the agency’s liquid and personal credit score methods, and in addition serves as a portfolio supervisor inside Oaktree’s world personal debt and world credit score methods. He beforehand labored for Pequot Capital Administration, the place he labored on distressed debt technique. Panossian holds an MS diploma in well being providers analysis from Stanford Medical College; a JD diploma from Harvard Regulation College; and an MBA from Harvard Enterprise College. He serves on the advisory board of the Stanford Institute for Financial Coverage Analysis.
We focus on what it was like throughout the nice monetary disaster when Oaktree had arrange a distressed bond fund — they have been buying 100 million {dollars} of bonds per day, usually the one bidder on the time, and sometimes watching the purchases go underwater instantly by 10-20%. The fund quickly after recovered, and generated wild outperformance over its lifespan.
Panossian explains how the present setting has been probably the most thrilling set of bond alternatives because the GFC. The sudden improve in charges — 500 foundation factors in 18 months — in opposition to the inflationary backdrop despatched Bonds down 16%, with enormous worth strikes as a result of sudden shift within the yield curve. Collateralized Mortgage Obligations with floating charges did properly, however the remainder of the sector simply froze as consumers disappeared, and costs started to fall. It was an enormous worth decline the place syndicators bought caught, very harking back to the 2008-09 period for banks. Non-public direct non-bank lenders stepped into the void, creating each dangers and alternatives.
An inventory of his favourite books is right here; A transcript of our dialog is out there right here Tuesday.
You may stream and obtain our full dialog, together with any podcast extras, on Apple Podcasts, Spotify, Google, YouTube, and Bloomberg. All of our earlier podcasts in your favourite pod hosts may be discovered right here.
Remember to take a look at our Masters in Enterprise subsequent week with Gary Cohn, Assistant to the President for Financial Coverage and Director of the Nationwide Financial Council from 2017-2018; he was President and Chief Working Officer of The Goldman Sachs Group from 2006-2016. Presently, he’s Vice Chairman of IBM.
Armen Panossian’s present studying:
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