With one of the worst quarterly performances on record in our rear view, we suggest investors add US investment grade and high yield bonds as a carry trade. While headwinds are significant, including continued supply chain issues, higher energy prices, and widespread inflation, the corporate borrower base is well funded and has built up a margin cushion. Through year end, we expect US bond market technicals to improve as IG issuance slows and institutional demand steadies.

 

 

 

Author:
Winnie Cisar, Global Head of Strategy, CreditSights