Loans performed well, while high yield faced some headwinds

Leveraged loans continued to perform well during the recent risk-off mode and upmove in interest rates, while US high yield bonds were negatively affected. The floating rate feature in leveraged loans offers a clear advantage to longer duration high yield bonds. In addition, leveraged loans offer a similar credit spread and only a slightly lower yield-to-maturity as compared to high yield bonds.

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Performance of US Leveraged Loans vs. High Yield Bonds
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