Insights

May 25, 2020

Small Growth passing baton to Small Value

Small value equities are valued -38% below their 10-year average, while growth, defensive, low volatility, and ESG factors exceed the bubble threshold of +30%. This dispersion has reached a 20-year high, in line with the dot-com bubble.

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J Paulo Silva
Portfolio Manager
April 16, 2020

Fallen Angels & the Fed

April 30th will see record fallen angel bonds move out of investment grade indices, more than the entirety of 2009. In response, the Fed has expanded its credit facilities to purchase fallen angels and HY ETFs.

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Peter Duffy
Portfolio Manager
March 31, 2020

Crisis Period Entry Points

Credit spreads peaked at 10.87% so far in the COVID-19 crisis. Spreads above 10% have occurred in 16 months over the last 25 years. In those 16 periods, high yield bonds have outperformed other asset classes, even stocks, over the 3 years that followed.

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David Jackson
Portfolio Manager
March 23, 2020

Spreads Above 700, Now What?

High yield bond spreads are 10.71% vs treasuries as of 3/25/20, elevated above the historical median of 4.89% due to macroeconomic uncertainty.

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David Jackson
Portfolio Manager
February 5, 2020

Top Ranked of 18,323 Indices

Short duration BB-B bonds continue to exhibit top ranked risk-return. To illustrate the extent of this anomaly, we’ve compared the ICE BofA BB-B 1-3Y index to every market index within the Morningstar Direct database.

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Peter Duffy
Portfolio Manager
December 16, 2019

Loan Alpha from Capacity Constraint

A loan fund’s size and investment opportunities are negatively correlated. This makes capacity constraint a key factor, allowing for high conviction focus on quality opportunities.

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David Jackson
Portfolio Manager