Gordian Knot

The last structured investment vehicle left on its own two feet has been pushed nearer the edge. Gordian Knot’s Sigma Finance SIV has been downgraded by Standard & Poor’s and Moody’s at a delicate time. The vehicle is about to refinance half its $40bn debt. That’s a big call in these markets. Sigma doesn’t owe its survival to luck. It has turned age to its advantage. Unlike newer rivals, Sigma was around to build its portfolio in the run up to the credit bubble, allowing it to be pickier with it...