JPMorgan's $50 Billion Fund Looks for Shelter in Junk Bonds
- Markets ‘more susceptible to negative shocks,’ Bernbaum says
- JPMAM sees attractive carry in high-yield corporate bonds
This article is for subscribers only.
One of JPMorgan Asset Management’s largest mutual funds is betting junk bonds will help shelter it from the trade war.
The firm’s $49.6 billion Global Income Fund has slashed its equities exposure to 31 percent at the end of October from 43 percent at the beginning of the year and put part of the proceeds into U.S. and European high-yield debt, according to co-manager Eric Bernbaum. The fund cut its stock holdings before the October sell-off, and turned to junk bonds where low default rates, declining leverage and strong fundamentals abound, he said.