Course Overview
The market for corporate and sovereign bonds, as well as private corporate loans, has been increasing rapidly in the past decade. Institutional investors, such as pension funds, insurance companies, as well as commercial banks, broker-dealers, and sovereign funds exhibit strong demand for these securities. We first discuss recent trends and the investment opportunities offered by corporate and sovereign bonds, including callable, convertible and other structured securities, their risks and their expected returns. We will then discuss the booming U.S. private credit market, including middle market corporate direct lending, real estate credit, asset-based lending, specialty finance and infrastructure debt; its market participants, and the risk and investment opportunities that it offers to both corporations (who borrow) and investors (who lend). Students will learn to apply factor models and optimization techniques to analyze and construct credit portfolios, as well as asset allocation methods that account for illiquid assets. The class aims to provide economic intuition as well as quantitative tools for managing credit portfolios.
The course will benefit students who are interested in asset management, banking, investment banking, financial consulting, as well as corporate Treasurers and risk managers.
