Alpinum Investment Management AG

Alpinum IM - Alternative Credit Letter December 2020

We are pleased to present you our monthly edition of our “Alpinum - Alternative Credit Letter”, which provides you a quick and concise overview (two pages only!) of the credit and fixed income markets. Alpinum Investment Management is an Asset Manager specialized in Credit and Alternative Investments solutions.
You find important current information to major credit markets in many instances with long data series, what enables the reader to put the prevailing market environment better into historical context. This month, we have a spotlight on the recent rating downgrades, which you find below:
IG credit spreads almost reached pre-Covid levels

During the market rally in November credit spreads have further tightened and reached almost pre-Covid levels in the investment-grade category, whereas spread levels are still wider in the high-yield market. OAS of broad US investment-grade corporate bonds are now only slightly higher (112 bps) in comparison to the start of 2020 (99 bps). US high-yield bond prices jumped in November with the positive vaccination news and as these bonds are more cyclical in nature and strongly benefit when the broader economy further "normalizes". Meanwhile, investment-grade bonds will be challenged at some stage with their embedded "duration" feature. While short term rates will remain low, the yield curve might steepen heading into 2021.
We hope you like the concise collection of information and insights on two pages only and maybe you will use it as a working paper - as we do.
Alternative Credit Letter - December 2020
Any feedback is very welcomed!
Alpinum IM Team
Talstrasse 828001 Zurich, Switzerland
P +41 43 888 79 30
F +41 43 888 79 31