By Mark R. Anderson, CFA

Risk markets enjoyed a very strong second quarter as investors looked past the Covid-related human, societal and economic damage, along with meaningful social discontent and a highly partisan political backdrop. The phrase “don’t fight the Fed” has rarely seemed so true and bond investors witnessed this positive sentiment push returns almost 3% higher as corporate debt was again popular despite a very heavy new issuance calendar. For the quarter, the Bloomberg Barclays Aggregate Index gained a healthy 2.90% on strength in the corporate, ABS, and CMBS sectors. It was just a quarter ago when these sectors lagged treasuries by a very wide margin. Our portfolio managers have welcomed the more normalized trading environment and we have used some of the market strength to move up in either quality or liquidity.

Read the full newsletter here: NIS Newsletter 2Q2020