Asset-Backed Securities
TwentyFour’s ABS funds cover the whole risk spectrum available, from enhanced cash to direct asset-backed lending.
Asset-Backed Securities Quarterly Update – January 2025
As the fourth quarter of 2024 comes to a close, TwentyFour Asset Management’s Douglas Charleston reflects on the past year’s events and explains why, in his view, the record supply of European ABS and CLOs in 2024 is likely to be matched in 2025.
Key takeaways
Asset-backed securities market performance
- Credit markets saw strong performance across the board in 2024, with investment grade strategies returning close to 8% and high-yield strategies close to 17%.
- Positive sentiment boosted primary ABS issuance to €137bn in total supply, surpassing the previous post-2008 record of €107bn in 2021.
Market outlook
- If geopolitical headwinds can be skirted once again in 2025, then we see three factors that bode well for European ABS - credit resilience, consolidated market growth and rangebound spreads.
- We expect 2025 to be another strong year for European ABS investors, in a market where income will remain king.
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