In a fourth quarter which thus far has seen a strong recovery for global markets despite continued uncertainty, the leveraged loan market has also seen a recovery, according to the Morningstar Leveraged Loan Indexes.
In the fourth quarter through November 8, the Morningstar LSTA US Leveraged Loan Index has risen 1.7%. In the same time period, the Morningstar LSTA US Leveraged Loan 100 Index, which tracks the 100 most liquid and tradable constituents within the US Leveraged Loan Index, has risen 2.6%.
Katie Binns, Senior Fixed Income Product Manager, Morningstar Indexes
“Unlike high yield bonds, leveraged loans have held up well in the rising interest rate environment. In particular, energy sector loans have had the strongest year-to-date performance within the Morningstar LSTA US Leveraged Loan Index. That said, the current election environment and midterms this week add an additional layer of uncertainty and market volatility for the loan market.”
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