This primer provides an overview of this niche area of investing, highlights some key features and potential benefits and presents the case for structured credit in a rising rate environment.
The Structured Credit Value composite returned 1.84% gross of fees (1.47% net of fees) for the quarter, while the Bloomberg Aggregate Index returned -0.84%. Q2 outperformance is primarily attributed to lower duration of the portfolio relative to Bloomberg Aggregate (2.1 yrs vs 6.3 yrs) and its higher carry (8.4% yield vs 4.8% yield).