Global High Yield Capabilities
Barings Global Senior Secured Bond Fund*
*The Barings Global Senior Secured Bond Fund principally invests in sub-investment grade and/or unrated debt securities. The Fund’s investment in senior secured debt securities does not guarantee repayment of the principal of investments by the investors
A Flourishing Income Opportunity
THINK DIFFERENTLY ABOUT HIGH YIELD
Overall MORNINGSTAR RATINGTM1
1. Overall Morningstar Rating as of March 31, 2024 (EAA Fund Senior Secured Bond Investments). For the Tranche G USD Dist Monthly share only, other share tranches may have different performance characteristics.
Higher Recovery Rates
Given their seniority in the capital structure, senior secured bonds offer greater potential for capital preservation relative to junior debt and equity.
Source: Moody’s Investors Services Annual Default Study, please note that the above data refers to North American non-financial companies. As of February 26, 2024.
Low GDP Growth has Limited Impact on High Yield Issuers
Historically, the high yield market has performed reasonably well in low growth environments. For instance, since 2010—despite Europe experiencing slower growth versus the U.S.—the European high yield bond market has been able to consistently outperform the U.S. on a like for like currency hedged basis.
Source: Bloomberg and ICE BofA. As of December 31, 2023. Returns in USD hedged terms.
Discounted Prices and Near-term Maturities Provide Capital Appreciation Potential
The discounted prices across the high yield bond market, together with record low duration and resilient corporate fundamentals, is presenting potentially attractive total return opportunities as companies proactively refinance. In the current market environment, we believe refinancings present an opportunity to increase total return prospects beyond the yield level on offer.
Sources: ICE BofA BB-B Global High Yield Secured Bond Index (HW4S). As of March 31, 2024. The return assumption is on the basis that bonds mature 12 months prior to legal maturity (as stated in the table), and that the bond does not default. For illustrative purposes only and is not indicative of actual investment return to be achieved by the Fund.
Note: Effective June 30, 2022, the ICE Fixed Income Index reflects transaction costs. As a result, existing index level total return, price return and excess return fields have been adjusted to reflect the new methodology. All return information prior to June 30, 2022 has not been adjusted.
Income Potential Unfolded
Explore the Global High Yield Bonds Strategy that Barings offers
