JP Morgan's Stealey: Why we have halved our high yield exposure this year

Improving portfolio credit quality behind fund's plans

Iain Stealey, who manages the £65.2m JPMorgan Global Bond Opportunities fund alongside Bob Michele, has been reducing the fund's allocation to high yield over the course of this year and upgrading the credit quality.

Stealey pointed out that the strategy has had a "pretty meaningful allocation to high yield since its launch six years ago". The 'toxic mushrooms' in the high yield market At times, over 50% of the portfolio has been allocated to the high yield space. "We have reduced that pretty significantly," he said. "We are running at slightly over 15% today and that has halved since the beginning of this year." Stealey explained that high yield "has had a very good run this year", with double-digit returns on most high yield markets. He also said at current spread levels "you are not re...