Kames' Ennett: Why we rejected Tesla's high yield bond

Company's ambition exceeds its cashflow

David Ennett, head of high yield at Kames Capital, explains why his team has not been attracted by Tesla's maiden issue.

In our experience, some of the best high yield bonds reflect those of us who invest in them; low-key, reliable, and often profoundly boring. The 'monotony' of a business that reliably posts juicy, but safe, cash flows? Sign me up! Some of our fondest positions are in glamorous industries such as cardboard boxes, funeral care, tin can making and the gel-like casings your headache tablets come in. Glitz and a good story is more often found in the equity market, and that is the way we like it. Why Tesla is overvalued after 'incredible' short-term returns A test to this rule came recen...