High Yield Bonds & Loans: Adapting to Changing Markets

Streaming Income - A Podcast from Barings

Against a backdrop of stickier-than-expected inflation, higher-for-longer rates, and persistent geopolitical risks, what is the outlook for high yield bonds and senior secured loans? Global High Yield Portfolio Manager, Brian Pacheco, weighs in.

Episode Segments:

(03:29) – How the macro backdrop has changed for high yield this year

(06:28) – Why the Barings team is bullish today on loans

(08:37) – Contrasting the steady return profile of loans with higher duration assets

(10:14) – Where loans sit from a valuation perspective today

(11:39) – How higher rates may impact the default picture

(14:20) – Liability Management Exercises (LMEs) – why they matter

(17:02) – Why high yield bonds may offer more value than commonly perceived

(25:33) – Risks to watch: Accelerating inflation, term premiums, & geopolitics

Certain statements about Barings LLC made by the participants herein may be deemed to be “testimonials” or “endorsements” as those terms are defined in rule 206(4)-1 under the Investment Advisers Act of 1940, as amended. Participants were not compensated in connection with their participation in this program, although in certain cases they are investors in Barings LLC sponsored vehicles. These investments subject such participants to potential conflicts of interest in making the statements herein.

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