By Tracy Chen, CFA, CAIA
The past decade following the global financial crisis has offered a cornucopia of good returns for most credit investors, despite occasional bumps along the way including the taper tantrum, European sovereign debt crisis, and China’s currency devaluation. The mantra of “buy the dip” has been highly extolled and handsomely rewarded. However, there are many paradigm shifts currently under way:
- Major central banks are at different stages of normalizing their quantitative easing ((QE)) programs
- The breakup of “Chimerica” forged under the old Pax Americana world order
- The ballooning of corporate credit