Capital Allocators – Inside the Institutional Investment Industry
David Breazzano - High Yields and Low Risk at Polen Capital (EP.405)
Sep 12, 2024
Dave Breazzano, Head of the Credit Team at Polen Capital, brings over 40 years of experience in high-yield investing. He shares the fascinating evolution of the high-yield market since the 1980s. Dave demystifies common myths about high-yield bonds, revealing lower default rates and valuable strategies for resilient investments. He discusses the impact of rising interest rates on private credit and the importance of adaptability in changing markets. Personal experiences in history and travel also shape his unique perspective on risk in finance.
53:35
Episode guests
AI Summary
AI Chapters
Episode notes
Podcast summary created with Snipd AI
Quick takeaways
- Dave Breazzano highlights how misconceptions about high yield bond default rates significantly mislead investors, impacting their perception of risk and return.
- His investment strategy focuses on constructing concentrated portfolios with strong financial companies, allowing for detailed research while adapting to changing market conditions.
Deep dives
The Evolution of High Yield Investment
High yield investments were initially considered a fringe category when Dave Brazano began his career in the early 1980s, viewed skeptically by much of the investment community. He worked at a major firm developing new securities appetite, with high yield starting to gain traction due to favorable market conditions like decreasing interest rates. As institutional demand surged, high yield became more mainstream, transitioning from a niche market to a sought-after investment vehicle. This shift set the stage for the establishment of high-yield mutual funds, which demonstrated solid performance metrics, countering prevailing myths about the asset class's high default rates.
Remember Everything You Learn from Podcasts
Save insights instantly, chat with episodes, and build lasting knowledge - all powered by AI.
