CLO tranches had strong total returns in July. JP Morgan estimated returns for July were 1.28% (AAA), 1.44% (AA), 2.18% (A), 3.50% (BBB), 4.03% (BB), and 4.74%(B). The CS Leveraged Loan Index returned 1.30% in July. CLOs and Leveraged loans had another strong month of returns, as a resilient and disinflation momentum reinforced the potential soft-landing narrative. While CLO spreads have experienced significant tightening in July, coupons for CLO debt continued to offer substantially higher payments relative to corporate bonds. Throughout the capital stack, coupons from CLO debt were more than double what their comparable fixed rate corporate bond provided.