Volta Finance Share Discussion Threads

[davebowler] 27/5/2021 10:07

Liberum..... In combination with improving fundamentals (lower default rates, rising OC test cushions), the environment for CLO equity and mezzanine returns remains very favourable.

[rambutan2] 24/5/2021 22:12

davebowler, thanks for these snippets you post across the threads from the likes of Liberum and Numis. They can provide a welcome check that one is not completely deluded when it comes to ideas in less populated areas of the trust sector.

[davebowler] 24/5/2021 09:05

Liberum;
CLO Funds

Positive market backdrop

Event

Almost all of the listed CLO funds have reported NAV figures for April 2021, with incremental NAV growth supported by positive credit markets and a favourable outlook for CLO returns. Loan markets generated a return of 0.5% in the month and trailing 12-month default rates continue to tick downwards. Corporate earnings rebounded strongly in Q1 and other indicators such as the distressed ratio (loans trading below 80c) also point to a benign environment. The technical position for CLOs is also positive with strong demand for AAA tranches and healthy primary issuance.


Across the listed CLO funds, cash distributions for the April quarterly payments were strong as none of the CLO equity or debt positions suffered from a diversion of payments to senior debt holders. Fair Oaks Income Fund reported total distributions of $12.2m received by the Master Fund II in April 2021 in relation to its US CLO equity positions, compared to $10.1m in the prior year. YTD returns range from 5.0% for Blackstone GSO Loan Financing to 9.2% for Fair Oaks Income. Blackstone GSO Loan Financing uses a mark-to-model valuation policy and therefore has a smoother NAV return profile. The outlook for CLO equity returns remains favourable due to relatively benign conditions and tight spreads on AAA tranches, driving down the weighted average cost of debt and creating opportunities for value enhancements through refi/reset of debt structures.

[cerrito] 17/5/2021 12:33

Just gone through the April report and at the moment everything seems a bit of a yawn, which to be frank is the why I like it with VTA.
I see for the second month running they did not buy any assets. Not sure why and will be interesting to see now that they have built up more cash what they do in May.
Thanks Skyship for link to Hardman which I will need to read again and more thoroughly.

[yieldsearch] 09/4/2021 10:10

refinancing benefiting the equity:
senior tranche of the clo are repaying so the weighted cost of a clo structure is overtime more expensive.
also current market pricing of new issuance to be issued at cheaper cost, and cheaper cost for longer term than existing
so all this combine means that currently there are opportunities to increase the return of the clo equity.

[hpcg] 09/4/2021 00:27

Well the interim report was a rewarding read. I need to get out a pen and paper to fully get my head around how the refinancing of a CLO benefits the equity tranche. Lots to like anyway.

[hpcg] 01/4/2021 09:26

wolstencroft - not true about IG in their standard Share Dealing account (it is for ISAs, but legally they are all Sterling). On the My IG dashboard open up the menu for the Share Dealing account and go to the "currency conversion" option and change it to "manual".

[wolstencroft] 01/4/2021 08:39

The liquidity on Amsterdam is much higher and it is an order book system (you put in your own bid and offer when buying selling) rather than market maker (where an authorised firm on the stock exchange is offering to buy shares at bid and sell at offer and make a bit of money on the spread to make up for taking the risk of being an intermediary being buyers and sellers)

On Amsterdam if the bid/offer is 6.02 to 6.08, say, you could always put in a buy/sell order in the middle (6.05) and wait. I have done this a lot. ii for example allow this. IG share dealing do too and they have better EUR/GBP rates buy they only offer a sterling account, whilst with ii you can hold proceeds from sales in EUR rather having them be converted to GBP.

[stemis] 29/3/2021 08:46

And it seems to work...

[stemis] 28/3/2021 00:09

Peeps may remember my previous comment on not being able to deal VTA in my AJ Bell Youinvest account. I've actually had a reply from them:-

Thank you for your email.

This particualr stock is listed twice on the London Stock Exchange, onced priced in Euros (VTA) and once priced in GBP (VTAS). Where this happens, as both are the exact same investment, we only offer the sterling priced one to avoid our customers being charged an FX fee unecessarily.

So if you’d like to trade this stock please either search for the ticker ‘VTAS’ or the sedol code ‘BFZ4H11’;.

[contrarian joe] 18/3/2021 12:58

Great stuff,thanks hpcg,yieldsearch.

[yieldsearch] 18/3/2021 11:06

Contrarian

6.02/6.08 with central book disclosed showing depth of market

[hpcg] 18/3/2021 10:31

contrarian - on Amsterdam the spread is tight but the price tends to be higher, so you pay's your money etc. Liquidity is worth it though and any top ups I make will be made over there, and I'll sell my LSE holdings first when the time approaches.

[contrarian joe] 18/3/2021 09:48

Held these for quite a few years & have tried to top up on numerous occasions only to find the spread awful (5%).How many of you guys have had the same issues!!,also having the option of having divis paid in either Euros or sterling via registrars,my views are convert when sterling weak,would appreciate views on this.

[stemis] 17/3/2021 17:39

That's why I said 'test'...

[hpcg] 17/3/2021 17:19

CWA1 - the tests are a bit risible really. Not, "Explain in 500 words CLO tranches and the relative risk?", more "Do you understand these are high risk instruments and you might lose more than you invest yes / no?".

Anyhoo, today's dividend announcement demonstrating the value on offer in the Autumn. Still good value.

[cwa1] 17/3/2021 16:50

Must confess I found Barclays the worst broker ever when I used them. Loads of stocks I couldn't buy, late dividends, clunky website. However it was aeons ago but it doesn't sound if they are much better

[cerrito] 17/3/2021 16:24

I cannot buy VTA on Barclays and I have to use my full service broker, Canaccord

[cwa1] 17/3/2021 16:09

Oh. There's a test. No wonder I'm not allowed to trade :-)

[stemis] 17/3/2021 15:50

Indeed. It's possible to deal with EQI and I've also passed Youinvest's little 'test' for dealing with complex instruments...

[skyship] 17/3/2021 15:36

Ahh - could be that. But why the hell are they deciding whether or not someone is professional enough to know what they are doing?

Surely it is not up to AJBell; it is up to the individual concerned to state that they have the knowledge to make their own investment decisions. I'm pretty sure all of us here on this thread would qualify to buy/hold VTA.

[cwa1] 17/3/2021 15:31

FWIW, I can't deal in VTA in my YouInvest SIPP account, I get this message when I go to get a quote:-

This security is restricted from dealing

...I think that anyone that is already a holder can buy or sell but you can't take a new position out with them I suspect

[skyship] 17/3/2021 15:04

SteMis - Bizarre - as I topped up my VTA holding this morning - dealt in my YouInvest SIPP.