Citywire - For Professional Investors

Register to get unlimited access to all of Citywire’s fund manager database. Registration is free and only takes a minute.

Gundlach plays down HY fears

Gundlach plays down HY fears

DoubleLine Capital founder Jeffrey Gundlach has played down concerns over a ‘meltdown’ in high yield but said he preferred emerging market debt to junk bonds at the moment.

Speaking on a webcast Gundlach said: ‘The volatility within emerging markets is actually a lot less than in high yield at the moment.’

In March Citywire + rated Gundlach had warned that an acceleration in 10-year yields could force high yield corporate debt into a ‘black hole of illiquidity’, but dampened down these fears in his latest webcast.

‘I don’t see a big risks of a junk bond meltdown,’ he said. ‘I wouldn’t be surprised if there is a technical sell-off in the space because currently a lot of people are buying them in an effort to chase returns.’

Within his US domestic Core Fixed Income fund, Gundlach has actually upped his allocation to high yield from 2.1% to 3%, and maintains an 8% weighting to emerging markets.

He has also increased the fund’s allocation to infrastructure bonds, upping the weighting from 3.5% to 5% and global bonds which he upped from 3.3% to 5%.

‘They [infrastructure bonds] are safe and have shorter duration—what’s not to like?’ Gundlach said.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Events
  • Citywire Santiago 2017

    Citywire Santiago 2017

  • Citywire Mexico 2017

    Citywire Mexico 2017

  • Citywire Miami 2017

    Citywire Miami 2017

  • Citywire New York 2016

    Citywire New York 2016

  • Citywire New York 2016

    Citywire New York 2016

  • Citywire Mexico 2016

    Citywire Mexico 2016

  • Citywire Mexico 2016

    Citywire Mexico 2016

  • Citywire Panama 2016

    Citywire Panama 2016

  • Citywire Latin America 2016

    Citywire Latin America 2016

  • Citywire Latin America 2016

    Citywire Latin America 2016

  • Citywire Miami 2016

    Citywire Miami 2016

  • Citywire Miami 2016

    Citywire Miami 2016

  • Citywire Panama 2016

    Citywire Panama 2016

  • Citywire New York 2015

    Citywire New York 2015

  • Citywire New York 2015

    Citywire New York 2015

  • Citywire New York 2015

    Citywire New York 2015

  • Citywire Santiago 2015

    Citywire Santiago 2015

  • Citywire Santiago 2015

    Citywire Santiago 2015