- Bank loans are not about whatever value people feel like putting on them, that’s essentially what equities are. They are about being paid back historically in an average of about 3-years. So the way to think of their value is to think about the odds of them being paid back one by one as you all know they are senior, they are secured by collateral, and they tend to trade near par most of the time.
- We believe there are three roads back to par for most loans. The first one, and most plausible we believe is market should recover in 6 to 12 months and loans would get back up to something close to par by collateralized loan obligation managers (CLOs) who’d like to buy loans at a discount.
- Prices are below what we think they would be in a normal recession, and normal recessions take a lot longer to resolve than this crisis should. They’re cheap fundamentally and fundamentals win in the end.
Before investing, consider the fund’s investment objectives, risks, charges, and expenses. Visit im.natixis.com or call 800-862-4863 for a prospectus or a summary prospectus containing this and other information. Read it carefully.
This material is provided for informational purposes only and should not be construed as investment advice. There can be no assurance that developments will transpire as forecasted. Actual results may vary. The views and opinions expressed are as of March 18, 2020 and may change based on market and other conditions.
Natixis Distribution, L.P. is a limited purpose broker-dealer and the distributor of various registered investment companies for which advisory services are provided by affiliates of Natixis Investment Managers.
Natixis Distribution, L.P. (fund distributor, member FINRA | SIPC) and Loomis, Sayles & Company, L.P. are affiliated.