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1 minutes to read by  BlueBay Fixed Income team, T.Leary, C.Da Gama Rose, CFA, A.Greenwood Oct 8, 2025

In a world of economic uncertainty and evolving market dynamics, US high-yield stands out as a compelling opportunity for investors seeking enhanced returns, balanced risk, and portfolio diversification.

Key takeaways:

  • US high-yield bonds offer compelling investment opportunities due to their higher yields compared to investment-grade bonds and Treasuries, coupled with improved credit quality.

  • Despite concerns about rising US government debt, inflation, and geopolitical tensions, US HY bonds are less sensitive to interest rate fluctuations due to their shorter maturities and lower duration.

  • The HY market's complexity underscores the value of active management in identifying high-quality issuers while avoiding riskier, lower-quality issuers. Active strategies can help investors navigate both up and down markets, providing access to issuers with strong fundamentals while managing exposure to economic or interest rate pressures.

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