Second, additional funding is reportedly broadly available to traditionally levered investors such as hedge funds. To the extent that investors choose to take advantage of the readily available funding for less liquid assets, their use of leverage could rise quickly, increasing the risks of a disorderly deleveraging.
A case study: the syndicated leveraged loan market I mentioned earlier that strong demand has been pushing prices higher in the syndicated loan market and figure 7 shows recent developments: Inflows into this asset class have indeed been robust and prices have been rising quite rapidly.