Tuesday, March 17, 2009

BWICs Gallore

March 31 redemption deadlines anyone? The avalanche of BWICs hitting the market is oddly missing from mainstream media... Just today a cursory glance reveals over $110 in CMBS million being shopped by brokers; additionally there is a $98 million loan BWIC as well as the odd $40 million of Lehman bonds looking for a bid.


BWICs, many argue, are the one true indicator of the level of deleveraging within the fund community. With two weeks left until hedge funds have to release tons of redeemed cash (especially newly unfrozen funds like Citadel and Fortress), look for this indicator to spring higher, and to provide terrific opportunities to buy bonds, loans and MBS at below market prices. Sphere: Related Content
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6 comments:

Daniel said...

Maybe the government should buy here, or are the prices too low?
/sarcasm

Anonymous said...

Any insight on how this will effect equities? Will funds look into equity liquidation to generate cash?

Thanks.

Anonymous said...

That's out of context - BWICs across RMBS, CMBS and HY today are actually decently slow and have been since the equity rally began last week.

Tyler Durden said...

who would presume to do the right thing and sell into a rising market...

Anonymous said...

a 110mm bwic on cmbs is an avalanche?
it will generate a whole 75mm in proceeds. now thats raising some cash!

thats oddly missing from media?
come on tyler, you know better than that (unless you really are "just a guy with a schwab account").

Tyler Durden said...

as a snapshot of the market in a 5 minutes range... it is pretty indicative