What Is The Definition Of The Global Collateralized Loan Obligation Market?
A collateralized loan obligation (CLO) is a financial product backed by a pool of corporate loans, often to companies with lower credit ratings. It is structured into various tranches with different levels of risk and return, allowing investors to choose based on their risk tolerance and return expectations.
Collateralized Loan Obligation Global Market Report 2024 provides data on the global collateralized loan obligation market such as market size, growth forecasts, segments and geographies, competitive landscape including leading competitors’ revenues, profiles and market shares. The collateralized loan obligation market report identifies opportunities and strategies based on market trends and leading competitors’ approaches.
How Are The Global Collateralized Loan Obligation Market Size And Growth Rates Projected To Evolve?
The collateralized loan obligation market has seen rapid growth, rising from $1,241.63 billion in 2023 to $1,413.75 billion in 2024 at a CAGR of 13.9%. Historical growth factors include the growing demand for alternative investments, increased trading activity, and interest in sustainable investments. By 2028, the market is expected to grow to $2,387.59 billion, with a CAGR of 14%. Growth drivers include expanded leveraged loan markets, governance-compliant products, and advancements in blockchain. Key trends include innovative loan structures, advanced regulatory compliance tools, and machine learning applications.
What Are The Essential Drivers Behind The Growth Of The Collateralized Loan Obligation Market?
The rising demand for high-yield investments is projected to accelerate the growth of the collateralized loan obligation (CLO) market. High-yield investments offer the potential for higher returns, attracting investors seeking better financial returns in a low-interest environment. CLOs are enhanced by the demand for higher returns, offering increased cash flow, diversification, and improved risk-return profiles. According to the Bureau of Economic Analysis in July 2023, foreign direct investment in the US surged by $216.8 billion in 2022, reaching $5.25 trillion. This growing demand for high-yield investments is driving the CLO market forward.
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How Is The Global Collateralized Loan Obligation Market Divided Into Key Segments?
The collateralized loan obligation market covered in this report is segmented –
1) By Type: Investment Grade, Non-Investment Grade, Equity Investment Grade
2) By Investor Base: Bank, Asset Manager, Insurance And Pensions, Hedge Funds, Other Investor Bases
3) By Sector: Technology, Healthcare, Services, Financial, Industrials, Housing, Food And Beverages, Paper And Packaging, Transportation, Other Sectors
What Trends Are Reshaping The Future Of The Collateralized Loan Obligation Market?
Companies in the collateralized loan obligation market are focusing on innovative CLO structures like exchange-traded funds (ETFs) to optimize risk-return profiles. Panagram Structured Asset Management introduced the Panagram AAA CLO ETF (CLOX) and Panagram BBB-B CLO ETF (CLOZ) in July 2023, offering liquid alternatives to traditional fixed-income investments with different risk profiles and expense ratios.
What Is The Fastest Growing Region In The Collateralized Loan Obligation Market?
North America was the largest region in the collateralized loan obligation market in 2023. The regions covered in the collateralized loan obligation market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
