CLO (collateralized loan obligation) owner Eagle Point Credit (ECC) has released their most recent quarterly update.
ECC owns the highest risk tranche of CLO’s – the equity tranche. This means they are first to take a loss if there are defaults in the portfolio. For those not familiar with CLO’s a good basic primer can be found here.
While CLO’s are generally thought of as risky investments Eagle Point Credit has provided a total return to investors of 8.53% annually since coming public in 2014.
Disclosure–I own both ECC preferreds and ECC baby bonds.