FundCalibre - Investing on the go

Investing on the go gives you direct access to the people who manage your ISA and pensions savings. Our hosts will be interviewing finance professionals on everything from their successes and failures to current ideas and insights. At meetings, before events and even if we bump into them on the street, we'll grab five minutes with these experts to discuss how your own personal finances could be impacted by topics such as US elections, the move from petrol to electric vehicles, the growth in artificial intelligence and robots, and so much more. Our ultimate goal is to bring to life the world of investments and uncover new and exciting opportunities, all while inspiring you to invest and giving you the confidence and knowledge to make the right decisions. To do this we often ask the managers why they are invested in individual companies. This is for illustration only and should not be taken as a recommendation to buy or sell that stock. The fund manager may or may not still own these companies at the time of your listening. For more investment research visit us at www.fundcalibre.com and follow us on twitter and facebook @FundCalibre

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FundCalibre - Investing on the go

341. Why high yield isn’t as risky as you think

November 14, 2024 • Jack Holmes

This episode discusses why high yield bonds, often labeled as ‘junk bonds,’ can be an attractive investment and how today's market is different from previous decades. Jack Holmes, co-manager of the Artemis Global High Yield Bond fund, shares their strategy of focusing on European and UK markets and prioritising higher quality bonds, like BB and B ratings, while avoiding riskier CCCs. Additionally, learn why shorter-dated bonds are favoured in the current yield environment and how inefficiencies in the high yield space create opportunities for active management.

What’s covered in this episode:

What is high yield?
Setting the scene for the high yield market
Europe over US exposure
Why CCC isn’t appealing
The inefficiencies of the high yield market
What active management adds for investors
How the fund uses currency in the portfolio
What does it mean when a high yield bond is ‘called’?
Adding value through market mispricing
What does rate cutting mean for high yield?
Why this manager is optimistic about next year
Backing cyclical or non-cyclical for 2025?

More about the fund: The Artemis Global High Yield Bond fund is a high-conviction fixed income portfolio investing in 60-100 high yield issuers across the globe. Managers David Ennett and Jack Holmes look to increase the value of shareholder investments through a combination of both income and capital growth. To do this they focus on the under-researched, inefficiently-priced opportunities further down the high yield spectrum, while their global approach looks to unlock opportunities and insights that regionally-focused peers may miss.

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.