Bain Capital analysis shows CLO debt-equity rotation delivers 10.5% net CAGR in backtest

• Bain Capital analysis found systematic rotation between junior CLO debt and equity outperformed static allocations from April 2013 through May 2026.
• The hypothetical strategy generated a 10.51% net compound annual return, versus 8.95% for sub-investment-grade CLO debt and 7.92% for CLO equity.
• Maximum drawdown reached 42.1%, compared with 53.2% for sub-investment-grade CLO debt; CLO equity’s maximum drawdown was 40%.
• Rotation captured 92.8% of CLO equity’s positive-month returns, with 73.1% participation in down months.
• The contrarian framework increased equity exposure following relative underperformance, maintaining a 60% equity allocation as of May 2026.

Disclaimer: This news brief was created by Public Technologies (PUBT) using generative artificial intelligence. While PUBT strives to provide accurate and timely information, this AI-generated content is for informational purposes only and should not be interpreted as financial, investment, or legal advice. Bain Capital Private Equity LP published the original content used to generate this news brief on November 02, 2026, and is solely responsible for the information contained therein.