BlackRock: Leveraged Loan, High-Yield Markets 'Increasingly Converging'

The video discusses the current state of high yield and leveraged loan markets, noting a lackluster issuance in high yield but a stronger performance in leveraged loans. It highlights a shift towards caution and quality in investments due to global growth concerns and geopolitical tensions. The convergence of high yield and leveraged loan markets is explored, with a focus on the impact of low and negative interest rates driving inflows into high yield assets.

What has been the trend in high yield issuance compared to leveraged loans?

• High yield issuance has been stronger than leveraged loans.

• High yield issuance has been lackluster, while leveraged loans have been stronger.

• Both high yield and leveraged loans have seen a decline.

• There has been no change in the issuance of both high yield and leveraged loans.

Which sectors are investors favoring in an uncertain market environment?

• Retail and automotive sectors

• TMT, cable, and packaging sectors

• Energy and mining sectors

• Real estate and construction sectors

How have high yield and leveraged loan markets changed over the years?

• High yield has completely replaced leveraged loans.

• They have become more distinct and separate.

• They have converged, with more competition between them.

• Leveraged loans have become irrelevant.

What effect have low and negative interest rates had on high yield investments?

• They have caused high yield investments to become more volatile.

• They have had no impact on high yield investments.

• They have led to a massive inflow into high yield due to its positive yield.

• They have decreased the attractiveness of high yield investments.

Why is high yield considered an attractive investment option in the current market?

• It is less liquid than other options.

• It offers a negative yield.

• It is risk-free compared to other investments.

• It provides a positive yield and shows resilient characteristics.