All investments involve risk. The value of your investment and the income from it will fluctuate and a loss of capital may occur.
In a global lower-for-longer yield environment, leverage flexibility and disciplined credit selection can help find the sweet spot between quality and risk in the USD high yield bond market.
With opportunities dispersed across a diverse landscape, USD high yield bonds may offer compelling diversification benefits to a global portfolio at times of market volatility and price fluctuations.
In addition, with valuations of USD high yield bonds at decade-long lows, it provides a compelling entry point for long-term investments.
John Yovanovic, Head of High Yield Portfolio Management, discusses the impact of fallen angels and unprecedented central bank actions on the high yield market and his outlook for the asset class.
Access to the depth and breadth of the USD high yield market
Captures total returns (income and capital appreciation)
Rigorous credit selection for alpha and risk control
The Sub-Fund is actively managed, in reference to a benchmark. Many of the securities in the Sub-Fund may also be represented in the benchmark because the Investment Manager uses it as a basis for portfolio construction, but the Investment Manager has some discretion to deviate from the Benchmark composition and risk characteristics within certain risk parameters. Examples of this are being aware of and constraining differences in sector, country or constituent weightings between Sub-Fund and benchmark. These constraints will vary over time and are subject to change. The Investment Manager does not target a specific tracking error for the Sub-Fund but historically, tracking errors have ranged from 1-4%. This is subject to change at all times. Though Sub-Fund may share some composition and risk characteristics with the Sub-Fund’s benchmark, the Investment Manager’s discretion may result in performance that differs from the Sub-Fund’s benchmark.
Fixed Income Default Risk: The failure of an issuer or a counterparty to meet its payment obligations of a financial asset in the Sub-Fund will have a negative impact on the Sub-Fund.
Derivative Risk: A Sub-Fund may use derivative instruments for both efficient portfolio management and for investment purposes. Derivative transactions may be subject to significant volatility which may result in a loss greater than the principal amount invested.
Counterparty Risk: A Sub-Fund may have credit exposure (by virtue of position in swaps, repurchase agreements, FDI etc.) to its trading parties and may bear the risk of default of the counterparties.
Operational Risk: A Sub-Fund may risk loss resulting from process failures, inadequate procedures or controls.
Liquidity Risk: The risk that the Sub-Fund may invest some of their assets in illiquid securities and other illiquid financial instruments, in respect of which they may not always be possible to execute a buy or sell order at the desired price or to liquidate the open positon.
Below Investment Grade Debt Securities Risk: Where Sub-Funds invest in securities rated below investment grade, also known as high yield securities, they may be subject to a greater credit, liquidity and market risk than investment grade debt securities.
Interest Rate Risk: Fixed income securities are typically interest rate sensitive, therefore changes in interest rates can result in positive or negative fluctuations in the value of the assets held by the Sub-Fund.
The risk factors described above should not be considered an exhaustive list of risks, which potential investors should consider before investing in the Sub-Fund. For more details on the fund’s potential risks please read the Prospectus and Key Investor Information Document at pinebridge.com/funds.
Unless otherwise stated, all information is as of 31 March 2023 and sourced from PineBridge Investments internal data. Investment involves risks. Past performance is not indicative of future performance. Investors should refer to the offering documents for details, including risk factors.
For illustrative purposes only. We are not soliciting or recommending any action based on this material. Any views represent the opinion of the Investment Manager, are valid as of the date indicated, and are subject to change. Diversification does not ensure against market loss.
PineBridge USD High Yield Bond Fund (the “Fund”) is a sub-fund of PineBridge Global Funds, an Irish domiciled UCITS umbrella fund, authorized and regulated by the Central Bank of Ireland. PineBridge Investments is a group of international companies that provide investment advice and market asset management products and services to clients around the world. PineBridge Investments is a registered trademark proprietary to PineBridge Investments IP Holding Company Limited.