John Stover, Portfolio Manager of Tribeca Asia Credit Fund, shares his cautious approach to risk amid recent Federal Reserve rate cuts, emphasizing a balanced allocation between Investment Grade (IG) and High Yield (HY) assets. He notes that while rate cuts benefit IG bonds, he may gradually increase exposure to HY investments over the next year, though he remains cautious about a potential U.S. recession. Stover’s strategy involves unique HY sectors such as Indian renewable energy and Indonesian real estate, often avoided by other managers, and is supported by protective hedges like credit default swaps. This approach has yielded over 15% annually in recent years with low volatility, balancing income generation and capital appreciation.
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