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SYZ & CO launches a Global High Yield Fund

Wednesday, November 16, 2011
Opalesque Industry Update - The Swiss banking group SYZ & CO has announced today the launch of OYSTER Global High Yield, a new sub-fund investing in high yield fixed income investments. OYSTER Global High Yield is managed by Seix Investment Advisors, a high yield manager based in the US with an excellent track-record.

The fund, which is still reserved for an institutional clientele, will be registered shortly in several countries in Europe and Asia, and become available to the public like the other OYSTER sub-funds. The current environment is particularly favourable to high yield investing, which offers competitive risk-adjusted returns compared to equities.

Now is a favourable time to invest in high yield
High yield bonds have historically generated highly competitive returns compared to equities on a risk-adjusted basis, without being strongly correlated to any other asset class within a portfolio, making them an important tool for diversification. Moreover, the current market environment is favourable to high yield investing. The recent “flight to quality” has led to market sell-offs, which offer investors a good opportunity to invest in this attractive asset class. Indeed, many companies have taken strong measures to adapt to the environment and display solid balance sheets.

As a result, current double-digit yields are inconsistent with the default rates forecast for the next two years. The implied default rate is nearly four times higher than the forecasts for company defaults (as measured by JP Morgan, one of the industry’s most followed benchmarks) and one-third higher than in a recessionary scenario. Finally, after downturns, high yield has typically delivered strong positive returns.

OYSTER Global High Yield: based on a proven strategy
SYZ & CO launches the OYSTER Global High Yield to complement OYSTER’s existing high added value fixed income range. The fund is managed by Seix Investment Advisors, a US-based investment boutique, which benefits from a strong reputation in the high yield industry. Seix has a unique expertise in this sector and has established a solid and consistent track record since 1997.

OYSTER Global High Yield replicates the strategy and investment philosophy of Seix’s high yield unconstrained strategy, which generated approximately twice the returns of its peer group on a 5-year basis. With a strong focus on liquid issues and on minimising the downside by avoiding defaults, OYSTER Global High Yield consists of a portfolio of between 80 and 110 issues. Full press release:Source

(press release)

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