Why credit investors now also need to be commodity experts

Supportive central bank policy

Credit spreads have had a turbulent 2016, starting the year with weakness followed by a significant rally, writes Atish Suchak, a specialist fixed income manager at Barings.

Divergence of views in the investor community on the asset class is immense, which will result in bouts of increased volatility during the year, but also investment opportunities. Add to that the increased short-term correlation with movements in the oil price means credit investors now also need to be commodity experts. Europe versus US: Where are the best high yield opportunities? Despite all of this, we have a cautious but positive view on high yield markets, and believe they can deliver decent total returns for the year. From a fundamental perspective, the US is in the latte...