Source: Board of Governors of the Federal Reserve System.
Conclusion: An uneven recovery suited for active managers
We expect economies and markets to continue recovering for the foreseeable future. While it’s impossible to say when we will put COVID in the rearview mirror, we expect the more challenged industries to bounce back gradually. However, not all will enjoy the same degree of recovery, which is why an active, risk-managed approach is critically important in today’s market. That’s why the MacKay Shields Global Fixed Income team invests in high conviction ideas, which employ a top-down, bottom-up approach. In today’s challenging markets, we focus on strong risk controls and seek diversified sources of return and income potential. Our team has demonstrated how a broad investment approach that considers an expansive multi-asset universe can surface compelling investment opportunities, including in low-yield and volatile times like these.
Footnotes and references
1. Not to be construed as tax advice. Consult your professional tax advisors for specific guidance.
The ICE BofA US BB High Yield Index, a subset of the ICE BofA US High Yield Master II Index tracking the performance of US dollar denominated below investment grade rated corporate debt publicly issued in the US domestic market. This subset includes all securities with a given investment grade rating BB. The ICE BofA Core Plus Fixed Rate Preferred Securities Index tracks the performance of fixed-rate US dollar denominated preferred securities issued in the US domestic market. This index is comprised of 100% retail securities and does not require securities to be investment-grade rated. The Bloomberg US Intermediate Corporate Bond Index measures the investment grade, fixed-rate, taxable corporate bond market whose maturity ranges between 1 to below 10 years. It includes USD denominated securities publicly issued by US and non-US industrial, utility and financial issuers. The Bloomberg US Treasury Intermediate Index measures US dollar-denominated, fixed-rate, nominal debt issued by the US Treasury with maturities of 1 to below 10 years to maturity.
“Bloomberg®”, “Bloomberg Indices®”, Bloomberg Fixed Income Indices, Bloomberg Equity Indices and all other Bloomberg indices referenced herein are service marks of Bloomberg Finance L.P. and its affiliates, including Bloomberg Index Services Limited (“BISL”), the administrator of the indices (collectively, “Bloomberg”) and have been licensed for use for certain purposes by MacKay Shields LLC (“MacKay Shields”). Bloomberg is not affiliated with MacKay Shields, and Bloomberg does not approve, endorse, review, or recommend MacKay Shields or any products, funds or services described herein. Bloomberg does not guarantee the timeliness, accurateness, or completeness of any data or information relating to MacKay Shields or any products, funds or services described herein. The information and opinions contained herein are for general information use only. New York Life Investments does not guarantee their accuracy or completeness, nor does New York Life Investments assume any liability for any loss that may result from the reliance by any person upon any such information or opinions. Such information and opinions are subject to change without notice and are not intended as an offer or solicitation with respect to the purchase or sale of any security or as personalized investment advice. There can be no guarantee that any projection, forecast, or opinion in these materials will be realized. Investing involves risk, including possible loss of principle. Past performance is no guarantee of future results. Information included herein should not be considered predicative of future transactions or commitments made by MacKay Shields LLC nor as an indication of current or future profitability. There is no assurance investment objectives will be met. Past performance is not indicative of future results. This material is provided as a resource for information only. Neither New York Life Insurance Company, New York Life Investment Management LLC, their affiliates, nor their representatives provide legal, tax, or accounting advice. You are urged to consult your own legal and tax advisors for advice before implementing any plan.