Global Credit
Our global credit strategies seek attractive risk-adjusted returns with an emphasis on income and yield.
Our philosophy
Our global credit strategies invest in securities with stable or improving fundamentals, focusing on mispriced risks
- Issuer and bond selection are our main performance drivers
- We use a regional approach, breaking down the investment universe into US, Europe and emerging markets for enhanced diversification
Our process
We use our local credit management and credit research teams to determine issuer, regional, sector and credit allocations.
- Lead portfolio managers leverage the insights of local credit analysts and portfolio managers and actively allocate across regions (US, Europe and emerging markets)
- Identifying, pricing and combining risks is at the core of our investment approach
HSBC strengths
- Many of our global credit strategies use alternatively-weighted, customised benchmarks targeting more attractive risk-adjusted returns
- Proprietary fundamental and valuation research tools are critical to our investment decisions and our risk calibration techniques
- Over 45 sector specialists cover the global credit universe across investment grade, cross-over and high yield names
Global High Income Bond Strategy
Aims to generate attractive risk-adjusted returns and steady income by investing the crossover space - lower-rated investment grade credit and higher quality high yield securities.
Our philosophy
- We believe bonds in the crossover space are inefficient as technical factors and market overreactions often lead to mispricing
- Certain investors are limited to investment grade credit and others to high yield. As a bond changes categories, managers are forced to sell, creating opportunities for managers that can hold transitioning bonds
Our process
We have developed a customised investment universe to expand the investment grade opportunity set globally to include higher rated high yield credit
HSBC strengths
- By investing the crossover space, we are able to target the yield potential of high yield bonds while maintaining an overall lower risk profile
- Our credit analysts focus on specific credits rather than ratings, allowing for continuity in coverage to provide the investment team with in-depth insights on the credit.
Global High Yield Bond Strategy
The strategy focuses on high yield opportunities in the US, Europe and emerging markets. We also manage a US Short Duration High Yield Bond strategy, which aims to provide attractive returns with lower duration and volatility.
Our philosophy
- Our risk-aware approach, local credit management and global credit research have been instrumental performance drivers
- Diversification is a key consideration in portfolio construction
Our process
- The strategy invests in high yield corporate bonds with the ability to invest in investment grade or lower rated high yield bonds opportunistically
- The lead fund manager allocates assets across US, Euro and emerging markets regions to capture different yield, quality, duration and volatility characteristics
HSBC strengths
The geographic reach and local insights of our global credit platform support the investment team in sifting through the broad opportunity set.
Focus on
The value of investments and any income from them can go down as well as up and investors may not get back the amount originally invested. The value of the underlying assets is strongly affected by interest rate fluctuations and by changes in the credit ratings of the underlying issuer of the assets.
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