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 September 30, 2024 (EAA Fund Senior Secured Bond Investments). For the Tranche G USD Dist Monthly share only, other share tranches may have different performance characteristics.
Seniority Helps Mitigate Credit Losses
Global senior secured bonds, while still subject to default risk, are more senior in the capital structure versus unsecured and subordinated credit instruments. This means that in the event of a default, senior secured bondholders are prioritized in the payment structure and better positioned from an eventual recovery on their principal investment. Being senior and secured in the capital structure may also be highly desirable in the current volatile market environment.
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.
Compelling Income Opportunity on Offer
The global senior secured bond market offers a higher income level versus other investment grade and high yield markets. A higher starting income level should also provide a higher total return potential.
Sources: ICE BofA. As of 30 September 2024.
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
