Junk Bonds More Attractive Than Leveraged Loans, Northern Trust's Robertson Says

The video discusses the debate between investing in leverage loans and high yield bonds, focusing on rate sensitivity and market dynamics. It highlights the attractiveness of both asset classes in a rising rate environment, with concerns about covenant light in leveraged loans. The tradeability of high yield bonds is emphasized, and a European perspective on investment strategies is provided. The importance of capital structure in investment decisions is also discussed.

What is a key factor that makes both leverage loans and high yield investments attractive in a rising rate environment?

• High default rates

• High duration sensitivity

• Low duration sensitivity

• Low liquidity

What is a major concern in the leveraged loan market discussed in the first section?

• High default rates

• Covenant light loans

• Low interest rates

• High liquidity

Why is the high yield market considered more tradeable than leveraged loans?

• More stable interest rates

• Higher default rates

• Lower issuance rates

• Better liquidity and tradeability

What is a characteristic of subordinated financials that makes them attractive in the high yield market?

• High default risk

• Low interest rate duration

• Low credit rating

• High interest rate duration

What is considered the most important component when deciding between high yield and leveraged loans?

• Issuance rates

• Market liquidity

• Capital structure position

• Interest rate trends