Fixed Income: Keeping an Eye on Inflation and Rising Rates | Lord Abbett
Image alt tag


There was a problem contacting the server. Please try after sometime.

Sorry, we are unable to process your request.


We're sorry, but the Insights and Intelligence Tool is temporarily unavailable

If this problem persists, or if you need immediate assistance, please contact Customer Service at 1-888-522-2388.


We're sorry, but the Literature Center checkout function is temporarily unavailable.

If this problem persists, or if you need immediate assistance, please contact Customer Service at 1-888-522-2388.

Tracked Funds

You have 0 funds on your mutual fund watch list.

Begin by selecting funds to create a personalized watch list.

(as of 12/05/2015)

Pending Orders

You have 0 items in your cart.

Subscribe and order forms, fact sheets, presentations, and other documents that can help advisers grow their business.

Reset Your Password

Financial Professionals*

Your password must be a minimum of characters.

Confirmation Message

Your password was successully updated. This page will be refreshed after 3 seconds.



Fixed-Income Insights

Lord Abbett Portfolio Manager Chris Gizzo examines the current backdrop for bonds—and where his team is finding potential opportunities. 


Air Date: April 7, 2021

Hi, I’m Chris Gizzo, a portfolio manager of multi-sector and high yield bond products at Lord Abbett.

Interstitial: Economic and Market Backdrop

So we had a fairly volatile end to the first quarter, especially underneath the surface in equities, as markets grapple with the pace of reopening and the impact of stimulus and what that means for the rate and inflation outlook. Looking into the rest of April, maybe we get a period of relative calm, some stability in rates or even a reversal in some of the pockets of weakness that we saw in the first quarter. And we are looking forward to what should be a very strong start to earnings season, that is coming up shortly.

On rates, which was the source of much of the volatility that we saw in Q1, it's interesting to note just how much is priced into the market at this point. As you can see, longer term rates failed to make new highs following immediately after some of the infrastructure details on stimulus that just came out.

But we are going to stay highly focused on the longer term outlook of rising inflation and higher interest rates in the US that will coincide with a very strong economic recovery and very strong fiscal policy.

That is still an environment that we think highly favors down-in-quality credit spread compression opportunities, and on an industry level, commodities, consumer discretionary, and economic reopening beneficiaries.

Those themes point our positioning on fixed income side very much toward a combination of high yield and bank loans and something like CMBS where you are still getting wider spreads, as you move up in quality.

Those asset classes have been relatively stable over the past month even as volatility grows elsewhere--that's most understandable in bank loans, given the interest rate protections that you have there, but it was also very true in high yield and CMBS as well and that speaks to the very strong and improving fundamental backdrop for those asset classes.

Focusing on the high yield asset class, which is our largest exposure--right now, you are being paid about three and a half percent over comparable Treasuries and, in our opinion, we can see that relationship tighten by around a half a percent so you can get price appreciation in the near term, in addition to very attractive carry.

Thank you very much for listening and thank you for your continued interest in Lord Abbett.



Commercial mortgage-backed securities (CMBS) are secured by mortgages on commercial properties rather than residential real estate. The underlying loans that are securitized into CMBS include those for properties such as apartment buildings and complexes, factories, hotels, office buildings, office parks, and shopping malls.

Carry represents the additional return accruing to an investor from holding a higher yielding security over a lower yielding security, assuming prices remain constant.

Unless otherwise noted, all discussions are based on U.S. markets and U.S. monetary and fiscal policies.

Asset allocation or diversification does not guarantee a profit or protect against loss in declining markets.

No investing strategy can overcome all market volatility or guarantee future results.

Market forecasts and projections are based on current market conditions and are subject to change without notice. Projections should not be considered a guarantee.

The value of investments in fixed-income securities will change as interest rates fluctuate and in response to market movements. Generally, when interest rates rise, the prices of debt securities fall, and when interest rates fall, prices generally rise. High-yield securities, sometimes called junk bonds, carry increased risks of price volatility, illiquidity, and the possibility of default in the timely payment of interest and principal. Bonds may also be subject to other types of risk, such as call, credit, liquidity, interest-rate, and general market risks. Longer-term debt securities are usually more sensitive to interest-rate changes; the longer the maturity of a security, the greater the effect a change in interest rates is likely to have on its price. Lower-rated bonds may be subject to greater risk than higher-rated bonds. No investing strategy can overcome all market volatility or guarantee future results.

The credit quality of the securities in a portfolio are assigned by a nationally recognized statistical rating organization (NRSRO), such as Standard & Poor’s, Moody’s, or Fitch, as an indication of an issuer’s creditworthiness. Ratings range from ‘AAA’ (highest) to ‘D’ (lowest). Bonds rated ‘BBB’ or above are considered investment grade. Credit ratings ‘BB’ and below are lower-rated securities (junk bonds). High-yielding, non-investment-grade bonds (junk bonds) involve higher risks than investment-grade bonds. Adverse conditions may affect the issuer’s ability to pay interest and principal on these securities.

This broadcast may contain assumptions that are “forward-looking statements,” which are based on certain assumptions of future events. Actual events are difficult to predict and may differ from those assumed. There can be no assurance that forward-looking statements will materialize or that actual returns or results will not be materially different from those described here.

This broadcast serves as reference material and is provided for general educational purposes only; does not constitute an offer to acquire, solicitation for an offer to acquire, an offer to sell or solicitation for an offer to buy, any securities, nor is intended to be relied upon as a forecast, research, or investment advice on any securities, and cannot be used for any of the foregoing.

The views and opinions expressed by the Lord Abbett speaker are those of the speaker as of the date of the broadcast, and do not necessarily represent the views of the firm as a whole. Any such views are subject to change at any time based upon market or other conditions and Lord Abbett disclaims any responsibility to update such views. Neither Lord Abbett nor the Lord Abbett speaker can be responsible for any direct or incidental loss incurred by applying any of the information offered.

The value of investments and any income from them is not guaranteed and may fall as well as rise, and an investor may not get back the amount originally invested. Investment decisions should always be made based on an investor’s specific financial needs, objectives, goals, time horizon, and risk tolerance.

Please consult your investment professional for additional information concerning your specific situation.

The information provided is not directed at any investor or category of investors and is provided solely as general information about Lord Abbett’s products and services and to otherwise provide general investment education. None of the information provided should be regarded as a suggestion to engage in or refrain from any investment-related course of action as neither Lord Abbett nor its affiliates are undertaking to provide impartial investment advice, act as an impartial adviser, or give advice in a fiduciary capacity. If you are an individual retirement investor, contact your financial advisor or other fiduciary about whether any given investment idea, strategy, product or service may be appropriate for your circumstances.

This broadcast is the copyright © 2021 of Lord, Abbett & Co. LLC. All Rights Reserved. This recording may not be reproduced in whole or in part or any form without the permission of Lord Abbett. Lord Abbett mutual funds are distributed by Lord Abbett Distributor LLC.




Please confirm your literature shipping address

Please review the address information below and make any necessary changes.

All literature orders will be shipped to the address that you enter below. This information can be edited at any time.

Current Literature Shipping Address

* Required field