Fixed Income Boutique

Global High Yield Outlook - The Return of Income and Capital Appreciation Opportunities


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Global High Yield Bond Outlook – The return of income and capital appreciation opportunities

Our children are in school – Yippee! Our children are complaining about homework – Boo! As parents, we try and emphasize the importance of homework as it prepares them for the actual tests to come. By forming solid habits, our children can learn the key notions and build confidence to succeed on exam day.

As investors, we have daily exams. We conduct our own detailed credit analysis – which is like homework – to prepare us for these constant exams. Our thorough preparation allows us to keep a cool head and aim for the best investment decisions.

Our Global High Yield Bond portfolio managers and credit analysts have done their homework, and they think now can be a good time to gradually increase exposure to our asset class.

In particular, they checked some facts about the default rates. They think that spreads are pricing in somewhat too much fear. The team also did some history homework and found a couple of optimistic anecdotes about returns that followed gradual entrance into the high-yield market under similar conditions in the past. More on this in our new Global High Yield Outlook.

Breathing deeply and slowly relieves stress during tests. Fact-checking helps take wise investment decisions.