Assessing the Opportunities & Risks in High Yield Today

With yields on bonds and loans near historical highs and the credit quality of the high yield market materially higher than in past cycles, investors may not need to take excessive risks to earn attractive returns in below-investment-grade markets today. Barings' Co-Head of Global High Yield, Scott Roth explains.

Episode Segments:

(02:00) – What’s gone right for high yield bonds and broadly syndicated loans in 2023

(04:56) – How high yield could fare if the Fed keeps hiking

(07:58) – The outlook for high yield in a peak rate scenario

(09:12) – The historical performance of high yield in recessionary periods

(11:34) – How high yield stacks up vs. equities and why investors are making asset allocation changes

(15:05) – High yield as a way to reduce volatility?

(16:57) – Assessing today’s market technicals

(19:22) – How the growth of private credit is impacting high yield bonds and broadly syndicated loans

(23:56) – The biggest risks facing high yield today

(26:50) – The impact of a China slowdown on global high yield

(28:04) – The bull case on high yield bonds and broadly syndicated loans

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