Oxford Lane Capital (OXLC) has posted their investor presentation for the quarter ending 9/30/2019.
Quite honestly the numbers look pretty shi… This CLO holder is destroying capital fairly quickly through their holdings of CLO equity. Collateralized loan obligations (CLOs) are not necessarily high risk, but the CLO equity positions are the highest risk of the CLO positions–generally earning returns only after the senior positions are paid.
OXLC holds mainly CLO equity positions which are the highest risk tranche of the CLO. NOTE the company’s net asset value has fallen 30% in the last year to $6.63/share–while their common shares trade at a huge premium to net asset value–$9.50/share right now. Seems like the common shares should get hammered down any time now.
OXLC has 2 issues of Term Preferreds outstanding which have traded well. You can see them here. These are protected by the leverage rule which requires 200% coverage of senior securities–and darned good thing or these would be crashing.
Some readers have noted how they have moved out of OXLC securities.
While we have held OXLC term preferreds in the past we haven’t in recent times.