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Credit derivatives specialist Solent Capital Partners already has €1.2 billion under management in CDOs and hedge funds, just two years after it opened its doors. Jonathan Laredo, who heads the firm’s CDO effort, talks to Rachel Wolcott

Tight spreads have dictated the tone of the credit markets for the past year, and now collateralised debt obligation (CDO) managers such as London-based Solent Capital Partners are bracing themselves for potential spread widening. The firm is about to launch a new CDO of credit default swaps, and is giving its investors some protection against a widening in credit spreads as the new deal’s key feature.

“Because the current spreads are so tight, investors are less interested in getting a leveraged