The $1.3 trillion US CLO market is taking its cues from Tokyo as much as Wall Street, according to a Wharton-led study. Price swings in collateralized loan obligations are increasingly dictated by Asian trading hours, reflecting the growing influence of Japanese investors in the structured credit space. Researchers found that Tokyo-based buyers now account for a significant portion of primary and secondary market activity, making their trading patterns a leading indicator for US CLO valuations.

The study highlights how global capital flows have reshaped traditional market dynamics, with Asian demand driving spread compression and new-issue pricing well before New York desks open.