High-Yield Won’t Bubble Over

It’s easy to spot a bubble after it bursts. Just follow the carnage—significant, and sometimes complete, losses for investors. It’s not so easy to pinpoint a bubble beforehand, but many are convinced that there’s too much air rushing into high-yield bonds today.

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Looking Under the Hood at High-Yield Bank Loans

Ashish Shah, Gershon Distenfeld and Ivan Rudolph-Shabinsky When you’re shopping for a car, you take a look under the hood to see what makes the thing run. You also check out the car’s features: does it have heated seats, a rear-view camera, a GPS?

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High-Yield Bank Loans: Look Before You Leap

Ashish Shah, Gershon Distenfeld and Ivan Rudolph-Shabinsky High-yield bank loans are a hot topic again in capital markets, with features touted as ideal for today’s environment. But we think it makes sense to take a closer look at what bank loans really are—and aren’t. In our opinion, there are a few holes in the case [...]

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Is CCC Credit Worth the Risk?

Typically, one would expect higher-risk assets to generate higher returns. But when it comes to high-yield corporate bonds, indiscriminate exposure to the CCC-and-below category may not produce the expected results. 

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The Opportunity in European
High-Yield Financials

European bond markets have been volatile in recent months, with high-yield financials suffering some of the worst turbulence. But we’ve seen this kind of volatility before, notably in 2008/2009. That bloodbath was followed by a highly lucrative rally. 

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The European Bond Markets Today:
Be Selective, Be Risk-Aware

Continued uncertainty and volatility are forcing European bond investors to think on their feet.  But there are ways to generate yield without taking excessive risk. 

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Rules of the Game Have Changed for Euro High-Yield Investors

The European sovereign debt crisis has changed the rules of the game for euro high-yield investors. Fixed-income managers are being challenged to think differently about both the risks and the opportunity set.

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High-Yield Bonds: Are ETFs the Best Vehicle?

High-yield exchange-traded funds (ETFs) have been growing like gangbusters in recent months, despite continued weak performance relative to the indices that they track. While these instruments make sense for investors who make rapid, tactical trades into and out of the asset class, we think they’re a poor choice for those seeking to gain long-term exposure [...]

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High-Yield Bonds: Equity-Like Returns with Lower Risk

On the surface, high-yield bonds look a lot like their relatives in the fixed income world. But in some key respects, high-yield debt acts a lot more like equities than like other bonds. This has some often unappreciated implications for portfolio construction.

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