Interest rates remained in an upward trajectory during the quarter as the yield on the 10-year U.S. Treasury climbed from 2.86% at the end of the second quarter to 3.06% at the end of the third quarter. Increasing interest rates were a headwind for rate sensitive fixed income assets with the Bloomberg Barclays US Aggregate Bond Index, a good proxy for the overall bond market, up 2 basis points (bps) in the third quarter and down 1.60% year-to-date (YTD). Despite higher interest rates and anemic returns in rate sensitive fixed income, high-yield bonds and senior loans have performed well. The high-yield bond index was up 2.42% in the third quarter while the senior loan index was up 1.82%. Senior loans are now up 4.03% on the year, better than all other major fixed income markets, while high-yield bonds are up 2.50% (Exhibits 1 and 2).