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  Senior Loan & High Yield Quarterly Review
Posted Under: Senior Loan
Senior loans and high-yield bonds, after a volatile second half in 2014, posted healthy returns in the first quarter of 2015. In fact, first quarter 2015 returns outpaced the full-year 2014 returns for both senior loans and highyield bonds. In contrast to last year, the start of this year has been driven by oil showing signs of stability (at least for now) after a nearly 50% decline in the second half of 2014, a market much more willing to tolerate the current geopolitical climate, and strength in returns across both the high-yield bond and leveraged loan markets. Moreover, an incredibly strong undercurrent created by some form of quantitative easing by central banks around the world is driving a global search for yield. With low and negative yields becoming commonplace in many countries and central banks furiously weakening currencies to stimulate demand for their countries goods and services, the U.S. finds itself standing alone, with interest rate increases, not decreases, on the horizon and a strong currency. The net result is that investors around the world are buying U.S. fixed-income instruments at an extraordinary pace. We believe the combination of this powerful technical demand for U.S. fixed-income securities, a healthy, albeit slow growing U.S. economy, and sound fundamentals (modest corporate defaults) within corporate America should continue to support the performance of fixed-income markets, including senior loans and highyield bonds.

For a discussion of notable events in the senior loan and high-yield market as well as an outlook for the future, click here to read the whole report.

Posted on Thursday, April 30, 2015 @ 2:43 PM • Post Link Share: 
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These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
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