The High Yield Playbook: Positions And Possibilities

2025-05-08 10:21:00 ET

Summary

• Spreads are much wider than where they were at the beginning of the year, which simply means that prices are lower and the risk premium that investors demand over treasuries is greater.
• With the most recent announcements from the administration around tariffs, our growth expectation and the expectation of growth for the market has come in considerably.
• There's really very interesting opportunities across all three of the major areas of non-investment grade credit.

By Joseph P. Lynch & Rachel Young

Explore how wider spreads, tariff impacts, and sector-specific trends are reshaping the high yield market.

Trnascript

Anu Rajakumar: From the evolving composition of the high-yield market to the impact of macroeconomic factors such as tariff-induced inflation and shifting interest rates, the current credit environment is as dynamic as ever. At the same time, trends like the rising appeal of loans and CLOs, as well as increased interest in European credit, are reshaping how investors approach fixed income strategies. But how can investors navigate this complex environment to uncover value beyond investment grade? What factors are driving these trends, and how should we assess risks and opportunities in today's market?...

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