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March 18, 2024 ARC Report

Is it time to cut?

The financial market’s health can be felt in the rise and fall of Asset-Related Certificates (ARCs), which saw a slight drop from $194 to $193 billion. The year-long historical data, illustrated in the ARC Report. Initially issued at an average coupon rate just below 7%, the ARCs currently trade at yields that tower over 900 basis points higher than their coupon rates, presenting a daunting refinancing scenario.

As the Federal Reserve convenes this week, the anticipation for a potential rate cut mounts. The outcome, set to be unveiled on Wednesday, March 20, 2024, could ease the burden for borrowers entangled in the high-stakes game of debt management.

Read more this month’s commentary. 

Picture of Steven Strom

Steven Strom

Managing Director, Odinbrook Global Advisors

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