326. High yield bonds: risks and rewards in today’s market

FundCalibre - Investing on the go

Mark Benbow, co-manager of the Aegon High Yield Bond fund, explains the evolving high yield bond market in this episode. Mark delves into the history and growth of the asset class, current market conditions, and the dual lenses through which investors can evaluate high yield opportunities. The discussion also covers how high yield bonds perform in volatile environments, where the best opportunities lie, and how these bonds can play a vital role in a diversified portfolio, particularly in the context of today's rising interest rates.
What’s covered in this episode:

• History of high yield bonds
• Where high yield sits today
• The impact of interest rates on this area of the market
• Why good companies don’t always make good bonds
• Was high yield impacted by the volatility in markets in early August?
• Why volatility isn’t something to be feared
• How central banks impact bond inefficiencies
• Why all-in yield is more important than spreads at the moment
• How the fund is yielding 8% today
• The best opportunities in the market today
• Why the managers are watching unemployment rates
• The role of high yield in an investor's portfolio

More about the fund:

Aegon High Yield Bond is an unconstrained, high-conviction, global high yield bond fund. Their approach is bottom-up focused, with an emphasis on deep, fundamental credit analysis. They complement this by a structured top-down process that governs overall risk. Their flexible mandate allows them to maximise their opportunity set by avoiding unwanted constraints imposed by a benchmark.

Learn more on fundcalibre.com
Please remember, we’ve been discussing individual companies to bring investing to life for you. It’s not a recommendation to buy or sell. The fund may or may not still hold these companies at the time of listening. Elite Ratings are based on FundCalibre’s research methodology and are the opinion of FundCalibre’s research team only.