How are politics impacting corporate credit markets?

2016 is likely to be remembered as a year when Western democracies took a surprising step towards the populist right with voters embracing political messages that included promises to roll back some of the effects of globalisation and towards fiscal stimulus, writes Fraser Duff, investment director, high yield at Standard Life Investments.

Brexit and Trump are the two most obvious manifestations of this but they have not happened in isolation. And this political uncertainty looks set to continue over the next year with 75% of the populous of the eurozone going to the polls in the next 12 months.  Where does this leave the outlook for corporate credit markets? In terms of bull points, one is in reference to high yield.  High-yield companies tend to be smaller and more locally focused so are less likely to be affected by trade barriers than larger cap companies. High-yield debt also tends to be relatively low duration ...