Global high yield update – Andrzej Skiba

Andrzej Skiba joins us on the BlueBay Insights podcast to share his expertise on the high yield asset class, discussing growth trends, the default outlook, ESG factors and where he sees investment potential this year.

We asked Andrzej: 

1. With the roll-out of Covid vaccines, most economists are predicting a sharp rebound in global growth during 2021. In your view, could this lead to inflationary pressures and losses in bond markets and how might this impact the high yield asset class?
2. Default rates were surprisingly low in 2020 largely due to government support schemes. As these schemes come to an end, do you expect defaults to pick-up damaging overall high-yield returns?
3. Fallen angels were a big topic last year – could you update us on any trends here and notable impacts from the 2020 downgrades?
4. Historically, the high yield universe was dominated by US issuers, but now the market is more global – how do you and the team manage portfolios to take account of this shift?
5. What about ESG in the high yield market? Is it possible to manage a high yield bond strategy while adhering to ESG principles? And does doing so impact performance?
6. Where do you see the greatest potential opportunities in 2021?