Global High Yield Capabilities
Barings Global High Yield Bond Fund
Income Potential Unfolded
CAPTURING ATTRACTIVE GLOBAL INCOME OPPORTUNITIES
Overall MORNINGSTAR RATINGTM1
1. Overall Morningstar Rating as of December 31, 2024 (EAA OE Global High Yield Bond). For the Tranche F USD Acc only, other share tranches may have different performance characteristics. Not intended to be offered to the retail public. Tranche F Shares are generally only available to feeder funds or fund of funds. Annual management fee of Tranche F Shares, which is currently 0%, is significantly lower than that of Tranche G Shares. Investors should note that the performance of Tranche F Shares is for reference only and does not represent the performance of Tranche G Shares.
Moderating rates and steady growth is constructive for high yield fundamentals
Central banks globally have embarked on an interest rate cutting cycle, which should ease the debt servicing burden for high yield companies and support the fundamental picture.
Source: Bloomberg, ICE BofA US High Yield (H0A0) Index. As of 31 December 2024. The 5 previous U.S. rate cutting cycles referenced here cover the periods 1995 (first cut on 5 July 1995), 1998 (first cut on 29 September 1998), 2001 (first cut on 3 January 2001), 2007 (first cut on 18 September 2007) and 2019 (first cut on 30 July 2019).
Higher Credit Quality Profile Relative to History
It is worth noting that high yield bond markets remain on solid footing and have one of the highest credit rating profiles today relative to history. Many issuers are BB-rated, and only 11% of the market is comprised of CCC-rated companies.
Source: ICE BofA Non-Financial Developed Markets High Yield Constrained Index (HNDC). As of 31 December 2024.
High income may provide a cushion even if the macro environment deteriorates
With yield levels exceed 7%, which they currently are, the high yield bond market has historically delivered a strong average return of 11% over the subsequent 12 months.
Sources: ICE BofA Developed Markets High Yield Constrained Index (HYDC). As of 31 December 2024. The reference period is from 31 December 2004 to 31 December 2024. Based on monthly observations.
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.
A Flourishing Income Opportunity
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