Insights

January 8, 2020
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Eric Green
Portfolio Manager

Avoiding the Pain Trade

A pain trade appears imminent for investment grade bonds, where the market delivers the maximum amount of pain to the most investors of an extremely popular asset class. At least according to credit spreads, which have historically indicated relative performance periods with high accuracy. Given the record high interest rate risk and low yield of investment grade bonds, it may be time to diversify core bond allocations with high yield credit.

Full Article
December 16, 2019

Loan Alpha from Capacity Constraint

A loan fund’s size and investment opportunities are negatively correlated. This makes capacity constraint a key factor, allowing for high conviction focus on quality opportunities.

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David Jackson
Portfolio Manager
November 20, 2019

Short Duration's Trojan Horse

Short duration bonds have a Trojan horse. Long maturity bonds often masquerade as short duration. With a minor price change, a short duration bond with a long maturity can become long duration, revealing far more risk than originally indicated.

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Peter Duffy
Portfolio Manager
November 12, 2019

Equity's Credit Blindspot

Equity has a credit blind spot. 95% of Russell 3000 companies issue debt, 75% of which is sub-investment grade. Equity investors study stock price movements but often ignore credit market signals. However, when a company's credit deteriorates, its equity follows.

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Joe Maguire
Portfolio Manager
October 15, 2019

Smart Yield Still Exists

Smart yield still exists. Short duration BB-B corporate bonds are providing high yield, downside protection, and interest rate protection in an ultra-low yielding environment. Yet the bonds remain largely overlooked by the industry.

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Peter Duffy
Portfolio Manager

 

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