Market commentary

High-duration fixed income, such as the Barclays Agg, performed well in August due to falling 10-year U.S. Treasury yields. Strong corporate earnings and U.S. economic data provided tailwinds for HY Bonds and Senior Secured Loans.

HY Bonds and Senior Secured Loans outperformed the Barclays Agg as retail inflows supported the leveraged credit markets on the back of strong monthly returns for U.S. equities.

High yield bonds and senior secured loans gain in June. Yield curve flattens on rising rate expectations.

Interest rate sensitivity drove returns during the month as higher-duration assets tended to outperform as 10-year Treasury rates fell.

As interest rates rose, high yield bonds and senior secured loans outperformed more duration-sensitive asset classes.

Benefiting from their floating rate coupon and position at the top of the capital structure, senior secured loan prices remained relatively steady in the face of rising short-end U.S. Treasury yields and a decline in U.S. equity prices.