Since the end of 2021 and as a result of structural shifts in the economy, from decarbonization to relocation of supply chains and higher geopolitical risks, interest rates entered a new regime. After two years of rates considerably higher than the previous decade, what are the implications for High Yield markets?
High yield markets are shrinking. Do you know that they have contracted by 25% over the past two years? The ICE BofA BB-B Global High Yield Index has lost $654 billion[1] in value. In the meanwhile, investor demand for credit and high yield has rebounded at the end of last year.
;
”Demand for credit has been very strong since Q4 2023, in a shrinking market and amid low credit dispersion. We think it is very important to remain focused on fundamentals and to be prepared for when the tide goes out.
Take also a minute to hear Charudatta Shende our Head of Client Portfolio Management Fixed Income, discuss our investment team’s analysis of the situation on credit markets. You will understand which strengths made the success of our credit team for the past twenty years!
This is a marketing communication. Please refer to the prospectus of the funds and to the key information document before making any final investment decisions. This marketing communication does not constitute an offer to buy or sell financial instruments, nor does it represent an investment recommendation or confirm any kind of transaction, except where expressly agreed. Although Candriam selects carefully the data and sources within this document, errors or omissions cannot be excluded a priori. Candriam cannot be held liable for any direct or indirect losses as a result of the use of this document. The intellectual property rights of Candriam must be respected at all times, contents of this document may not be reproduced without prior written approval.
Candriam consistently recommends investors to consult via our website https://www.candriam.com the key information document, prospectus, and all other relevant information prior to investing in one of our funds, including the net asset value (“NAV) of the funds. Investor rights and complaints procedure, are accessible on Candriam’s dedicated regulatory webpages https://www.candriam.com/en/professional/legal-information/regulatory-information/. This information is available either in English or in local languages for each country where the fund’s marketing is approved.
All investments involve risks, including the risk of loss of capital.
The most significant risks of High Yield bond strategies are: risk of capital loss, interest rate risk, credit risk, high yield risk, counterparty risk, ESG investment risk.
This list is not exhaustive and more details on risks associated with investing in high yield bond strategies are available in the related strategies’ regulatory documents.
[1] Source: Bloomberg©, ICEBofA BB-B Global High Yield Index (HW40) in USD currency, between end of 2021 and February 2024
Get information faster with a single click
