Author Archives: Heather Rupp

Where to Go?

We are in the midst of a global low yield environment.  Yields on the 10-year bonds (yes, 10 years) for Switzerland, Japan, and now Germany are negative, and yields are under 0.50% for much of Europe.1 With the Fed meeting …

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Strategies for Investing in a Rising Rate Environment

Accurately calling interest rate moves has proved to be a difficult, and futile, task for investors over the past few years as we have seen wild moves and really no sustained direction.  The only aspect of rates that can be …

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Managing Liquidity in a Changed Market

It is no secret that liquidity in the secondary high yield corporate bond market has changed since the financial crisis, especially with the implementation of certain banking regulations that limit market making activities by the large banks.  In response to …

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Positioning for Value

Last week we discussed that despite the recent rebound in the high yield market, we still see value to be had in this space (see “Too Far Too Fast?”).  Not only do we currently view actively managed high yield bonds …

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Too Far Too Fast?

We have seen a pretty sizable bounce back in the high yield market off of its February 11th lows, with spreads declining and prices rising.1 This leads to the question, have we come too far too fast?  We believe that …

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High Yield Market Technicals: The New Issue Market

We continued to see the broader high yield market rebound in April after hitting multi-year lows in mid-February, despite bankruptcies accelerating as we had expected. Looking at market technicals, as we have seen buyers and interest come back into the …

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US Financial Markets: Demographics and the Income Opportunity

We are in the midst of a global shift in demographics as the Baby Boom generation ages and faces retirement, causing a need for reduced volatility in their investments.  We believe this creates real issues for future money flows.  We …

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High Yield Bond Investing: Understanding Yield and Default Rates

We’ve always viewed default risk as one of the primary risks in high yield investing.  Unlike stocks, bonds have an end date and value via their maturity date and maturity price of par.  There may be a lot of price …

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Strategy Adjustments: Sell Discipline

As we noted last week, we have made some strategy adjustments as we work to help improve liquidity and dampen volatility.  Along those lines, we have implemented a sell discipline.  While as active managers we are always monitoring our holdings …

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Strategy Adjustments: New Issue Allocation

Investing is a dynamic process and managers must adjust to the market in which they find themselves.  We have done just that with some recent strategy adjustments.  To address the liquidity issues and concerns within the high yield market, we …

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