NB launches first global high-yield fund for Flynn

Added 8th August 2016

Neuberger Berman is to access the US, Europe and emerging markets with a Dublin-domiciled Global High Yield Bond Fund, headed by Patrick Flynn.

NB launches first global high-yield fund for Flynn

Launched today with assets of $77m (£59m), the Ucits vehicle will target a yield of around 5.5%.

The asset manager’s $37.6bn high-yield franchise already incorporates European, US and short duration Ucits portfolios, as well as funds operating in emerging hard and local currency debt.

The new fund is billed as a “natural extension” of its capabilities in the asset class.

Flynn will run the fund in collaboration with US colleagues on his flagship $7.8bn High Yield Bond Fund, as well as local managers in Europe and Asia.

The portfolio is initially split 65% in the US, with 20% in Europe and 15% in emerging markets.

It has around 20% in commodities, though the focus is primarily on high-quality business, particularly those involved in ‘mid-stream’ operations, while there is a preference for so-called ‘fallen angels’ in metal and mining.

Flynn said: “The depth and breadth of the global high-yield universe has developed markedly in recent years, with investors attracted to its defensive characteristics and low correlation to other asset classes.

“In our view, global high-yield valuations are compensating investors for the default risk in the market. Excluding commodity sectors, credit quality across global high-yield markets remains solid, which should set the scene for gradual spread tightening.”

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Gary joined Last Word Media in 2009, becoming editor of Portfolio Adviser a year later. Previously, he worked at Incisive Media with roles across its Professional Adviser, Investment Week, Bloomberg Money and Mortgage Solutions titles. Gary has been shortlisted for various awards, winning Headline Money Investment Writer of the Year in 2010.

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