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This week, we converse with Armen Panossian, managing director and head of performing credit score at Oaktree Capital Administration, which has $179 billion in property underneath administration. He oversees the agency’s liquid and personal credit score methods, and likewise serves as a portfolio supervisor inside Oaktree’s world non-public 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 Legislation 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 in the course of the nice monetary disaster when Oaktree had arrange a distressed bond fund — they have been buying 100 million {dollars} of bonds per day, typically 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 surroundings has been essentially the most thrilling set of bond alternatives for the reason that GFC. The sudden improve in charges — 500 foundation factors in 18 months — towards the inflationary backdrop despatched Bonds down 16%, with big value strikes as a result of sudden shift within the yield curve. Collateralized Mortgage Obligations with floating charges did effectively, however the remainder of the sector simply froze as patrons disappeared, and costs started to fall. It was an enormous value decline the place syndicators bought caught, very harking back to the 2008-09 period for banks. Personal 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 obtainable right here Tuesday.
You’ll be able to 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 might be discovered right here.
Make sure you 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. At the moment, he’s Vice Chairman of IBM.
Armen Panossian’s present studying:
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