With Yields in the High Yield Market at All Time Lows, Investors Should look to Convertibles as a Viable Alternative

Allocators and consultants continue to seek out alternative options to a core fixed income allocation as concerns grow over rising rates and the possibility of heightened volatility. As rates have continued to rise, investors are turning to less liquid or non-core options and one of the asset classes that is commonly utilized is the high yield market. This has led to yields of high yield bonds steeply declining to all-time lows of sub 4% and when you combine that with rising interest rates and impending inflation fears, the outlook for the asset class is in question. We believe that this is an opportune time to seek alternatives and one of the optimal allocations given the current environment includes actively managed convertible strategies.

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