Taking a neutral view of the high-yield sector

Taking a neutral view of the high-yield sector

We evaluate the high-yield market by looking at three key factors: fundamentals, valuation, and “technicals,” or the balance of supply and demand. We are neutral on all three. Looking first at fundamentals, we see an economic landscape marked by countervailing trends. GDP figures in the United States continued to lag past recoveries. Nonetheless, corporate fundamentals

High-yield debt lifted by low default rate

High-yield debt lifted by low default rate

Coming out of the financial crisis in 2008–2009, corporations took aggressive steps to shore up their balance sheets and rein in expenses, and today they are running very lean, profitable organizations, with the added benefit of having record levels of cash on hand. It has been a very attractive combination for investors, especially given the