3 global sectors where it pays to be invested right now

While it may be a relatively small opportunity in Australia, high yield investing is a well-known opportunity in many other parts of the world. Investors who are game enough to parse the rising interest rate narrative and look at the fundamentals of the companies issuing these sub-investment grade bonds could make a fortune along the way. 

That's because high yield bonds are generally considered more prone to default and maturity wall risk - two things every fixed income investor would consider disastrous in the unlikely times it occurs.

The S&P U.S. High Yield Corporate Bond Index is up nearly 10% in the past year. Sure, it's not the Magnificent Seven but it's far better than a term deposit. 

But given high yield investing is a small opportunity and knowledge of the sector is limited among most investors, we thought it was high time (pun intended) that we give our audience a masterclass in the asset class.

Enter Mike Della Vedova, an Australian-born, London-based global high yield portfolio manager. For nearly 30 years, Della Vedova has been working in and around the global credit markets. In this edition of Views from the Top, he shares his wisdom on how investors can get in on this fascinating part of the investment universe (while debunking a few myths besides.)

Timecodes

• 0:00 - Intro
• 0:29 - What drew you to high yield investing in the context of your career?
• 1:19 - How does credit stack up as an opportunity against equities and bonds?
• 2:36 - What kinds of sectors are issuing this debt?
• 2:57 - What kinds of companies are issuing this debt? (Companies mentioned include - Match Group (NASDAQ: MTCH), Under Armour (NYSE: UAA), Levis (NYSE: LEVI), Tata Motors (NSE: TATAMOTORS), Aston Martin Lagonda (LON: AML), United Airlines (NASDAQ: UAL), Goodyear (NASDAQ: GT), Rolls Royce (LON: RR), Inter Milan, Big Brother's Producer Endemol
• 4:41 - Why should an investor consider high yield investments versus just buying the stocks of the issuing companies?
• 5:19 - How do you determine the quality of an issuer?
• 5:52 - Where are you finding the best opportunities now?
• 6:30 - Are we seeing a big increase in defaults?
• 7:08 - How do you manage maturity risk?
• 7:58 - Opportunities in European companies and the global services (conference organisers, IT outsourcing) sector
• 9:15 - What role does regulation play in your investing strategy?
• 10:01 - Michael's View from the Top

Seeking high income and capital appreciation?

Learn more about how Mike and team approach to global fixed income securities by visiting the T Rowe Price website or the fund profile below

Managed Fund

T. Rowe Price Global High Income Fund – S class

Global Fixed Income

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