Bank Loans: Diversification, Quality, Active Management, and Potential Expectations for 2023
George Goudelias, Head of Leveraged Finance and Senior Portfolio Manager at Seix Investment Advisors, was recently joined by Joe Terranova, Chief Market Strategist at Virtus, for an in-depth discussion on the bank loan market and the potential benefits of the asset class as a diversification tool.
Market Review and Outlook 4Q22 - Leveraged Finance
In 2023, we expect total returns of 5-6% for the loan market depending on the depth of the recession and short-term interest rate progression. For the high yield market, while fundamentals will likely weaken through 2023, the asset class is entering the expected slowdown in its best fundamental shape ever.
Why It’s Time to Add High Yield Bonds
High Yield spreads widened significantly over the course of 2022, making high yield valuations more attractive.
Our Approach to ESG
The integration of Environmental, Social and Governance (ESG) risk analysis into our existing investment process brings another level of risk assessment to our decision making process. By focusing on discrete risks and potential opportunities related to ESG, we are better able to select those companies with proven business models designed to withstand exogenous shocks. Since inception, Seix has managed portfolios for clients with social exclusions including gaming, weapons and tobacco.