Back to basics
We take you back to the credit basics to review everything you thought you already knew but were too afraid to ask ... Avarina Miller, senior vice-president at Demica, looks at trade receivables
As asset quality increasingly comes under the spotlight in the current market conditions, it is evident that a highly rated, diversified pool of receivables is an attractive proposition - not least because it becomes liquid between 30 and 90 days and therefore avoids concerns associated with asset-liability mismatch.
Therefore from an investment and risk perspective, the attractions of trade receivables are diversity and short tenure. But those same advantages represent a challenge for portfolio
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