Shifting credit markets could push SRT pricing wider
Rising volatility may force issuers to adjust pricing in line with broader credit spread trends
Pricing on synthetic risk transfer deals is likely to follow a spread-widening trend seen across the broader credit market as investors demand greater compensation amid rising market volatility, according to a senior investor in the instruments.
“What we’ve seen more recently is spread widening in a variety of liquid assets. SRT is slow to move but is not market immune,” said Kaelyn Abrell, a portfolio manager and partner at ArrowMark Partners.
“We would expect that this spread widening will start
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