IFR: Investors slow to embrace riskier ABS as primary market resumes

May 7, 2020
Original article by Richard Leong

Jake Remley, Senior Portfolio Manager at Income Research spoke with IFR’s Richard Leong about the slow return of demand for lower-rated U.S. asset-backed securities since the primary market reopened last March after a COVID-19 induced supply pause. For lower-tier securitised paper, investors have been demanding much wider spreads and higher yields because of worries about rising defaults and delinquencies with soaring unemployment levels. Remley explained this is the case as buyers are enforcing wider spreads.

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