Relative value and performance drivers across fixed-income sectors.
The outlook for credit amid rising inflation, monetary tightening, and war in Europe.
Exploring the performance of leveraged credit in past tightening cycles.
High-yield investors should be weighing the risks of contagion more carefully.
A properly diversified credit portfolio should have exposure to both high-yield corporate bonds and bank loans.
Strong earnings growth, low default volumes, upward rating migration, and tighter spreads in the recovery phase of the credit cycle.
Our positive 2021 economic outlook, combined with better-than-expected company fundamentals, supports strong credit performance and spreads.
Credit spreads still have room to tighten, but default risk remains elevated in certain sectors.
As a result of the Federal Reserve’s efforts to shore up credit markets, the leveraged credit sector has delivered stellar performance since the lows in March.
While the U.S. speculative-grade default rate could reach 15 percent in this cycle, the market is offering better entry points than seen in years.
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