In this environment, we find ourselves faced with more nuanced and idiosyncratic stories across sectors, geographies and sub-asset classes – an incredibly fertile ground for our Credit and Private Debt teams. Flexibility, clarity of thinking, a diligent underwriting process and avoiding complacency will all be essential.
This is not a ‘buy the dip’ situation, and credit analysis will be at a premium. Our credit analysts have been working diligently alongside our engagement professionals to recalibrate the inputs in their models and in some cases completely rewrite them.
At the international business of Federated Hermes, we take an active, high-conviction approach to investing – something that history suggests has the potential to perform well in volatile periods. While we are mindful that the lows are likely not behind us, we remain optimistic about the potential to generate supernormal alpha in credit markets over the next 12 months.
The value of investments and income from them may go down as well as up, and you may not get back the original amount invested.
For professional investors only. This is a marketing communication. The views and opinions contained herein are those of the Credit Team at the international business of Federated Hermes, and may not necessarily represent views expressed or reflected in other communications, strategies or products. The information herein is believed to be reliable, but Federated Hermes does not warrant its completeness or accuracy. No responsibility can be accepted for errors of fact or opinion. This material is not intended to provide and should not be relied on for accounting, legal or tax advice, or investment recommendations. This document has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient. This document is published solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Figures, unless otherwise indicated, are sourced from Federated Hermes. This document is not investment research and is available to any investment firm wishing to receive it. The distribution of the information contained in this document in certain jurisdictions may be restricted and, accordingly, persons into whose possession this document comes are required to make themselves aware of and to observe such restrictions.
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