Portfolio Strategy - Brown Brothers Harryman focuses on finding and growing value for clients managing money on a generational basis [3] - The firm's portfolio construction includes approximately 30% in fixed income, 40-45% in public equities diversified globally, and a significant focus on alternative investments [4] Alternative Investments - The firm is finding value in structured credit within fixed income, including asset-backed securities, CLOs, CNBS, and RMBBS, which are typically accessed privately [6] - Single A rated tranches of structured credit vehicles are delivering 200 basis points (2%) more return than corporate equivalents, with historical capital preservation [8] Municipal Bonds - High-quality municipal bonds with a duration of four to five years, funding America's infrastructure, can generate returns around 7% on a tax-equivalent basis for high-income earners in high-income tax jurisdictions [9][10] Stock Selection - The firm invests in long-term durable businesses with massive competitive advantages, including some of the "Mag Seven" companies [11] - Specific companies mentioned include Microsoft (due to Azure's growth in AI), Mastercard, Visa, and Transdime [11][12] - Transdime, an aerospace aftermarket company that IPOed in 2006, has compounded in excess of 30% since then [13][14]

RT BSCN (@BSCNews)VERTUS LAUNCHES BLOCKCHAIN-BASED PLATFORM FOR STRUCTURED CREDIT ON THE XRP LEDGER- One of Brazil’s top financial service firms, @THE_VERTUS, has launched a blockchain-based platform for structured credit, with a debut transaction valued at BRL 700 million (USD 130 million), built on the @Ripple XRP Ledger (XRPL).- The newly unveiled platform is designed to mirror private credit operations and fund activities onchain, making key financial events traceable and transparent in real time.Key De ...

VERTUS LAUNCHES BLOCKCHAIN-BASED PLATFORM FOR STRUCTURED CREDIT ON THE XRP LEDGER- One of Brazil’s top financial service firms, @THE_VERTUS, has launched a blockchain-based platform for structured credit, with a debut transaction valued at BRL 700 million (USD 130 million), built on the @Ripple XRP Ledger (XRPL).- The newly unveiled platform is designed to mirror private credit operations and fund activities onchain, making key financial events traceable and transparent in real time.Key Details:- The platfo ...

Stablecoins and private funds have led the way as TradFi embraces tokenization.What's next?"Structured credit is an ideal candidate for tokenization," says @ThomasCowan93, head of tokenization at @galaxyhq.Opinion.https://t.co/IZY6rfHGuw ...

Summary of Key Points from the Conference Call Industry Overview - The conference call primarily discusses the structured credit market, focusing on asset-backed securities (ABS), collateralized loan obligations (CLOs), and commercial mortgage-backed securities (CMBS) [2][3][6][8]. Core Insights and Arguments 1. **Issuance Slowdown**: The structured credit market is expected to experience a significant slowdown in issuance, as indicated by a drop in ABS-15G filings, which serve as a proxy for deal volume [2][27]. 2. **CLO Market Dynamics**: While CLO creation has remained stable, it is anticipated that the primary CLO market will slow down as new issue spreads align with secondary market spreads [3][35]. 3. **Used Car Prices Impact**: An increase in used car prices, which rose by 10%, is projected to reduce auto ABS severities by 2-2.5%, providing some insulation for auto ABS mezzanine bonds during a recession [6][21]. 4. **Rising Default Rates**: Higher leveraged loan default rates are expected, with forecasts suggesting that the share of CCC-rated loans in CLO portfolios could rise from 6.6% to 9.1% if default rates reach 8% [15][17]. 5. **CMBX Downgrade**: The CMBX 17 BBB- rating has been downgraded to neutral from overweight due to concerns about the correlation between growth and rates, which may not stabilize as previously thought [6][8]. 6. **Investment Strategy**: Investors are advised to shift towards higher-quality SA/SB BBB bonds, which, despite appearing expensive, offer a defensive position against market volatility [12][16]. 7. **Tariff Impacts**: The automotive sector is facing potential price increases due to tariffs, which could raise new vehicle prices by approximately 15%, affecting auto ABS investors [21][22]. Additional Important Insights 1. **Market Volatility**: The structured credit market is currently turbulent, with a notable decline in ABS-15G filings, particularly in esoteric and equipment ABS [27][29]. 2. **CLO Pricing Discrepancies**: There is a divergence between primary and secondary CLO spreads, suggesting that current new issue pricing may not reflect true market conditions [35][38]. 3. **Defensive Positioning**: The recommendation for investors is to focus on secondary market opportunities, particularly for CLOs managed by experienced managers, to mitigate risks associated with rising default rates and market volatility [35][41]. 4. **Forecasts for Structured Products**: The report includes forecasts for structured product spreads and housing measures, indicating a cautious outlook for the market in the coming years [43][44]. This summary encapsulates the critical points discussed in the conference call, highlighting the current challenges and strategic recommendations for investors in the structured credit market.