Securitized credit markets closed out 2022 with positive momentum that carried over into early 2023. Still, the past year was the most stressful period for securitized markets—outside of the global pandemic-induced meltdown in early 2020—since the recovery from the 2008 global financial crisis (GFC).
Signals from the Federal Reserve that its rate‑hiking cycle is nearing an end, a welcome moderation in high inflation and interest rate volatility, a year‑end slowdown in issuance, and increased demand for securitized products from yield‑focused investors all contributed to a mild recovery amid improved liquidity conditions. However, securitized credit sectors began to recuperate later than their corporate counterparts and generally ended the quarter with credit spreads1 at wider levels despite rallying into year‑end.
Volta Finance Ltd (LON:VTA) is a closed-ended limited liability company registered in Guernsey. Volta’s investment objectives are to seek to preserve capital across the credit cycle and to provide a stable stream of income to its Shareholders through dividends that it expects to distribute on a quarterly basis.
