Video: The deep divide in credit markets, and how to take advantage

2 May 2022

The following was produced and published by Livewire on 2 May 2022.

Currently, a big chunk of the credit market shows negative real yields and excessively high levels of interest rate duration risk. However, Ares Australia Management focuses on asset classes at the other end of the spectrum that have high cash yields and lower duration risk.

“Some credit asset classes look very attractive, from a risk-return perspective. We believe these can act as a yield enhancer and diversifier in portfolios,” says Head of Ares Australia Management, Teiki Benveniste.

In the video above, he runs the magnifying glass over a chart that explains why some parts of the credit universe are so attractive, while others are in dire straits.

Disclaimer – Fidante Partners

Fidante Partners Limited ABN 94 002 835 592 AFSL 234668 (Fidante), a member of the Challenger Limited group of companies (Challenger Group), has entered into arrangements with Ares and Ares Australia Management Pty Ltd ABN 51 636 490 732 (AAM), in connection with the distribution and administration of financial products managed by Ares or AAM. In connection with those arrangements, Fidante or AAM may receive remuneration or other benefits. Neither Fidante nor AAM nor any of their associates are responsible for the information in this material, including any statements of opinion and accept no liability whatsoever in relation to it. AAM is an Authorised Representative No. 001280423 of Fidante and is in the process of seeking its own Australian Financial Services Licence. Ares is exempt from the requirement to hold an Australian Financial Services Licence. Ares is subject to regulation by the Securities & Exchange Commission of the United States of America under US laws, which differ from Australian laws. This publication is only made available to ‘wholesale clients’ or ‘sophisticated investors’ under the Corporations Act 2001 (Cth) in Australia. Fidante is not an authorised deposit-taking institution (ADI) for the purpose of the Banking Act 1959 (Cth), and its obligations do not represent deposits or liabilities of an ADI in the Challenger Group (Challenger ADI) and no Challenger ADI provides a guarantee or otherwise provides assurance in respect of the obligations of Fidante. Investments in the Fund(s) are subject to investment risk, including possible delays in repayment and loss of income or principal invested. Accordingly, the performance, the repayment of capital or any particular rate of return on your investments are not guaranteed by any member of the Challenger Group.