Are Bank-Loan Investors Getting What They Bargained For?

Ashish Shah (pictured) and Ivan Rudolph-Shabinsky Investors who chose high-yield bank loans over high-yield bonds earlier this year, expecting to be insulated against rising rates, might be surprised to find that bonds might have worked out better.

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Beware the Dangerous Stretch for Yield

The US Federal Reserve talked in early summer about tapering its quantitative easing plan and raising interest rates—in part to stop investors from chasing yield into the arms of riskier loans. In the high-yield market, however, the conversation had exactly the opposite effect.

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With Rates Going Up, Give Bonds Some Credit

After the bond market’s stumble last quarter, defending against rising rates has moved front and center for many investors. One approach that has been effective over time has been exposure to credit-oriented sectors and strategies.

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Rising Rates: Time to Position, Not Panic

It finally happened. After endless discussion about the potential for rates to rise, they finally did—in a big way. During May and June, the 10-year US Treasury yield soared by nearly one percent, and markets reeled. Instead of panicking, investors should make sure their portfolios are positioned effectively.

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Keeping Your Balance During Shaky Markets

By Paul DeNoon (pictured) and Gershon Distenfeld While capital markets have had their ups and downs, it’s been at least 15 years since we’ve seen such a broad swathe of the global markets take a hit at the same time—risky and “risk-free” assets alike.

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Breaking Down Borders in High Yield

After a multiyear rally, many high-yield investors are looking for new strategies to better balance risk and return. We don’t think a deep dive into riskier credits is the answer. Instead, investors should consider moving beyond traditional boundaries—both geographic and in credit rating.

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Emerging-Market Debt: Pure High-Yield Strategies Come of Age

We believe investors should be thinking about emerging-market debt in terms of credit quality buckets (investment grade or high yield) rather than sectors (sovereign or corporate). For some types of investor, pure high-yield strategies can offer significant advantages.

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Don’t Be Afraid of European High Yield…
Be Selective

The European financial crisis continues to challenge high-yield investors. Some were wary of Europe’s issues and stepped away last year, only to see European bonds dominate through the unpredictability. Others want in now, but worry that they’ve missed the rally.

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We Expect High-Yield Defaults to Remain Low

High-yield bond defaults are historically low today, even for troubled companies. Despite the worries we hear in some corners about looming high-yield defaults, we think default rates will stay low for at least the next few years.

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High-Yield Bonds: Tackling the Tough Questions

With high-yield bonds at record high prices and interest rates so low they’re barely visible in some parts, investors have a lot of anxious questions. Our opinion: we think high-yield bonds still offer more income and fare better in rising rate environments than other bond types.

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