We look for consistent management teams as well. So not only is there a consistent track record, but making sure that the portfolio managers have longevity in their seats. We look for deep teams, making sure they have a robust industry analyst team, supporting that as well. So, those are just something few things that we look at, but ultimately track record is ultimately what we focus on.
Matthew Howlett: Well, you’re capturing high end of field that you said with 18% on cost basis and you’re up in quality. Just seems like that’s their risk adjusted return, the place to be. And then maybe, Nishil, can you comment on resets? I mean, there’s not a lot going on from what we can tell me. How should investors think about that if that was to open up next year? Is that just embedded upside in the portfolio when you the way you think about it?
Nishil Mehta: Yes, that’s exactly right. So resets have been limited in 2022 and 2023 as debt spreads have widened. So, it’s really been uneconomical for a vast majority of deals to be reset because you’re refinancing your debt at a wider or higher price or higher cost, and so it’s been limited. So right now, 40% of the market is going to be out of reinvestment period by the end of this year. If CLO market and debt do rally and they tighten, we do think there’s going to be a surge in resets, and that’s the only upside. We don’t forecast resets or refinancing in our portfolios, but there are certainly deals and that we currently have invested in. That would definitely benefit from resents. So, I agree. It’s just upside from here.
Matthew Howlett: And then I guess just last question, a bigger picture question. I mean, Mickey touched on it in terms of differentiation from the outstanding peers out there. You have obviously on one hand you guys are ramping in this opportunity environment, so you don’t own things at a higher basis like the others. The debts obviously a little bit higher, but I’m assuming that that’s callable at some point and become more of an issue where your cost of capital is going to go down and you get bigger. We touched on the differentiation with this vehicle, it’s Carlyle, we all know the name versus some legacy stuff out there, and is it just cleaner that you’re ramping in a better environment, and you could pick and choose higher quality managers and still get very great yields? Just a different and going forward, just differentiation, just maybe highlight on how you’re going to differentiate, what you’re going to do differently for investors?
Nishil Mehta: Yes. I think you touched on a couple of them, one, just being part of a larger Carlyle platform. Carlyle today is close to $400 billion, including $150 billion in credit in global credit. But the fact that Carlyle is one of the largest deal managers. Globally, why that’s so important is, the team that manages CCIF, we can leverage that expertise when analyzing CLOs because CLOs are effectively 200 or 300, pools of 200 or 300 loans. And so, we can leverage our industry analysts to do bottoms up analysis. So, I think that that’s a definite benefit. We have benefited from the fact that we are ramping this portfolio in periods of volatility. And so we’ve been able to make purchases at historically discounted prices, which has been attractive.
I think the other benefit to that is while we mentioned we’re in a default rate environment where we think default rates are increasing, a vast majority of those defaults are well telegraphed. And so when we’re underwriting the investments that we’ve made, we’ve already identified what positions we expect to default. And so, it’s the benefit of investing today versus having a more seasoned portfolio. Three, right now, our focus has been on longer dated CLOs, the average reinvestment period left is three plus years. We currently do not have any deals that we’ve purchased, so, say, three, four, five years ago that are now exiting reinvestment period, so that that’s a differential as well.
Matthew Howlett: Well, that’s huge. I mean, most companies have sort of 25% of density or something like that. That’s a huge differentiator. And of course, Carlyle, it’s great to see the name out there and the track record and really to be able to utilize those resources are terrific. Really appreciate it and look forward to you to continued growth.
Nishil Mehta: Thanks Matt.
Operator: Thank you. And as I see no further questions in queue, I will pass it back to Lauren for closing comments.
Lauren Basmadjian: Thank you. We look forward to speaking to everyone next quarter, if not sooner. Please feel free to reach out if you have any questions. And thank you for all of your support. Have a great rest of your year.
Operator: Thank you all for your participation in today’s conference. This does conclude the program and you may now disconnect.