5 Years of European High Yield

How has the opportunity evolved since 2011?

Over the last 5 years since we launched the strategy in September 2011, some of the key highs have been the opportunity we've seen created in the market. The market has really evolved and grown and become a core source of capital for a lot of corporations, not just within Europe, but also globally.

The market is being accessed by companies core in Europe, companies that have operations in Europe that may be headquartered in the US, for example, or in the emerging world. It's also being accessed right now by companies looking for hard currency in the form of euros, to raise capital, and these companies may have limited operations in Europe. So it's more global than ever before. Now, the key challenge there is: how are resources applied to looking at that market right now? I'm confident that we're able to look at the broad array of opportunities we get because we have such a global resource base.

What have you learned over the last 5 years?

The key aspect has been some of the complexity of opportunities we've seen: the willingness to look at capital structures of companies who are coming to our market holistically, to dig into the detail and identify the best place within that capital structure for our investors and to be able to identify those risks and price those risks.

What is your outlook for the future?

The outlook for the European high yield market will be one of even more complexity, evolved structures, greater opportunity. To position the portfolio, therefore, means to take into account those situations. To be willing to look at the opportunity set very broadly; not discount any one opportunity simply because you haven't seen it before; and therefore to remain focused on being selective, and being selective on a bottom up basis.

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