High yield bonds are weaker this morning on continued outflows. Pressure is again being applied to the energy sector as the hurricane aftermath is weighing on the price of oil and oil related bonds. The 10-year Treasury dropped to 2.11% this morning on the latest North Korea missile launch.
With that said we still see some value in individual high yield bonds and loans. We don’t see much value in owning an index-based funds, as that sort of investment vehicle is not strategically positioned to take advantage of weakness in certain industries and securities within that industry that trade down for wrong or temporary reasons. We believe that an active high yield portfolio can serve to provide tangible income streams and total return potential above what the general market offers.