FET - CrossingBridge Advisors Q2 2024 Commentary

2024-07-23 10:45:00 ET

Summary

• In today’s fixed income market, we find ourselves in a similar position, “between a rock and a hard place”.
• Tight credit spreads as well as the inverted yield curve and elevated uncertainty make for a very challenging outlook.
• After a brief discussion of the tightening of credit spreads, as reflected in the high yield market, we provide specific examples of recent investments made during 2Q24.

Chimney Climbing

Skilled mountain climbers sometimes find themselves forced to employ sophisticated techniques. One in particular, known as "chimney climbing", requires that the mountaineer wedge their body between two opposing rock surfaces, pushing on each side in order to continue progressing upward. Figuratively, in today's fixed income market, we find ourselves in a similar position, "between a rock and a hard place". ¹ Tight credit spreads as well as the inverted yield curve and elevated uncertainty caused by the interrelationship between economic activity, interest rates, and geopolitics make for a very challenging outlook. After a brief discussion of the tightening of credit spreads, as reflected in the high yield market, we provide specific examples of recent investments made during 2Q24 as further illustration of the ongoing investment themes in our portfolios....

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