PIMCO's Kiesel: High yield sell-off means short-dated opportunity

The recent sell-off in high yield means opportunities in the 'rising stars', housing, and building materials sectors, explains PIMCO's deputy CIO Mark Kiesel.

The volatility of the high yield bond sector in July and August reminded investors of the significant influence that technicals can exert on the market. After ten months of positive performance, investors rushed to the exit doors, leading to negative returns and the sector's longest and largest outflows ever, according to EPFR.  What is notable is how these outflows continued despite favourable bottom-up credit fundamentals, reinforcing how crucial it is to play both offence and defence constantly in these markets. The outflows may have created a better entry point to invest in high y...