Credit | Investment Insight
May 24, 2023

Multi-Asset Credit: The Asset-Backed Finance Allocation

Multi Asset Credit

About the Author

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Akila Grewal

Partner

About the Author

avatar
Akila Grewal

Partner

Joe Moroney | Partner, Yield Multi-Credit Lead

Robert Bittencourt | Partner, Co-Head of Opportunistic Credit

Akila Grewal | Partner, Head of Credit and FIG Product

The securitization market has evolved since its birth in the 70s, with its latest transformation offering the potential for increased diversification, yield enhancement and downside protection for Multi-Asset-Credit. Now ABF is being taken private by new entrants shaking up the established order to the benefit of semi-liquid portfolios.

Key Takeaways

  • While many people may not realize it, the Asset-Backed Finance (ABF) market is part of our daily life and is a critical source of financing for small and medium sized companies.
  • As banks have retrenched from the ABF market over the past decade, specialty lenders and private capital have filled the gap with innovative financing solutions.
  • Today, the ABF market spans a broad range of sectors and industries that represent a diversified opportunity set in credit and one that is bigger than the US corporate fixed income market.
  • An allocation to ABF may provide attractive benefits including portfolio diversification and yield enhancement as well as a possible hedge against inflation.

The information herein is provided for educational purposes only and should not be construed as financial or investment advice, nor should any information in this document be relied on when making an investment decision. Opinions and views expressed reflect the current opinions and views of the authors and Apollo Analysts as of the date hereof and are subject to change. Please see the end of this document for important disclosure information.

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