Lynam: Credit Dispersion is Back

The video discusses key themes for 2022, focusing on the return of dispersion in credit markets and the importance of credit selection. It explores the credit market's role in assessing risk appetite and recession outlook, highlighting the resilience of stocks. The impact of supply and demand on the high yield market is examined, noting low issuance levels. A record decline in bond prices is discussed, attributed to rate changes rather than credit issues. Finally, the video analyzes fund flows, showing that they do not significantly drive market performance despite outflows in high yield markets.

What is one of the key themes for 2022 mentioned in the video?

• Growth in technology sector

• Decline in stock market

• Return of dispersion

• Increase in interest rates

How does the credit market relate to the equity market according to the video?

• Credit market is less volatile than the equity market

• Credit market has no relation to the equity market

• Credit market is considered smarter than the equity market

• Credit market is always behind the equity market

What is the expected movement for the IG market by the end of 2022?

• From 1:25 to just over 1:50

• From 1:50 to just over 1:25

• From 500 basis points to 350

• From 350 basis points to 500

What has been the trend in gross issuance in the high yield market for 2022?

• Significant decrease

• No change

• Running very light

• Significant increase

What is the record decline mentioned in the video?

• 15% decline in high yield market

• 10% increase in bond market

• 11% decline in investment grade paper prices

• 12% increase in stock prices

What is a key difference between IG and high yield markets?

• High yield market is less volatile

• High yield market has more spread-based buyers

• IG market has a large contingent of spread-based buyers

• IG market has more retail investors

According to the video, what do fund flows not drive?

• Performance

• Market volatility

• Interest rates

• Stock prices