High Yield Fund Class P | Lord Abbett

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High Yield Fund

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Summary

Summary

What is the High Yield Fund?

The Fund seeks to deliver current income and the opportunity for capital appreciation by investing primarily in high yield corporate bonds.
 

A HERITAGE OF HIGH YIELD

Brings a 40+ year history of high-yield investing, focused on fundamental, bottom-up credit research.

AN OPPORTUNISTIC APPROACH

Provides the flexibility to adjust to the market environment and take advantage of opportunities across the credit spectrum.

STRONG TRACK RECORD

Has offered a track record of strong performance versus peers in up and down markets, demonstrating the strength of this active approach as a core high-yield holding over a full market cycle.

Fund Basicsas of 02/29/2024

Total Net Assets
$3.81 B
Inception Date
Dividend Frequency
-
Number of Holdings
681
Type Assets
High Yield Bonds
Bank Loans
Equity
Convertibles
Investment Grade Bonds
Cash
Maturity Assets
Less than 1 year
1-3 years
3-5 years
5-7 years
7-10 years
Greater than 10 years

Credit Quality Distribution as of 02/29/2024 View Portfolio

Rating Assets
BBB
BB
B
<B
Not Rated

INVESTMENT TEAM

Steven F. Rocco
Steven F. Rocco, CFA

Partner & Co-Head of Taxable Fixed Income

22 Years of Industry Experience

Robert A. Lee
Robert A. Lee

Partner & Co-Head of Taxable Fixed Income

32 Years of Industry Experience

Christopher Gizzo
Christopher Gizzo, CFA

Partner, Deputy Director of Leveraged Credit

15 Years of Industry Experience

Karen  J. Gunnerson
Karen J. Gunnerson

Portfolio Manager

13 Years of Industry Experience

Supported By 82 Investment Professionals with 18 Years Avg. Industry Experience

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Performance

Performance

Portfolio

Portfolio

Rating Assets
High Yield Bonds
Bank Loans
Equity
Convertibles
Investment Grade Bonds
Cash
Rating Assets
Less than 1 year
1-3 years
3-5 years
5-7 years
7-10 years
Greater than 10 years

Credit Quality Distribution as of 02/29/2024

Rating Assets
BBB
BB
B
<B
Not Rated

Portfolio Positioning as of 12/31/2023

  • We continued to invest in shorter duration high yield credits that offer high carry. The risk rally in the final months of the year led high yield spreads to meaningfully compress and reach their tightest levels since April 2022. While we believe there is still modest room for spreads to move lower, we acknowledge that valuations are relatively tight, and we continue to be more focused on sourcing investments that offer higher income with more limited duration exposure. We see value in the new issue high yield market as a strong source of carry given higher coupons and continue to actively participate in select primary issues.
  • We added to the Fund’s allocation in lower-rated credits. We increased the Fund’s exposure to CCC credit throughout the period which we viewed as offering better relative value compared to higher-rated high yield bonds. We viewed that economic data in the U.S. such as lower inflation continued to support lower-rated tiers compared to higher-rated BBs which had relatively tight valuations. The CCC additions over the quarter were across various sectors such as Telecommunications and Media that demonstrated resilient performance, particularly in issuers where we had been meaningfully underweight. We have continued to monetize positions in BBs as a source of funds for these trades, targeting bonds with tight valuations or offering low coupons. We also continue to prioritize liquidity given market uncertainty.
  • We reduced Energy exposure in favor of higher beta sectors. Although we continue to be constructive in the Energy space given the sector’s fundamental strength and improvement in balance sheet management, we reduced exposure in December given continued softness in WTI Crude prices which dropped below $70 for the first time since 2021. However, this allocation change has not altered the Fund’s top overweights or underweights. As of the quarter-end, the top sector overweight positions in the Fund included Basic Industry, Energy and Transportation. Fund underweights continued to be Healthcare, Media and Services, albeit more modest than in prior quarters.
  • We view high yield as an opportunity to capture high-quality carry. Yields, which have come down modestly following a strong quarter for high yield, are still near the highest levels seen in the last decade. We remain constructive in high yield credit considering the overall resilience of the U.S. macroeconomy. Inflation may remain above the Fed's target, which could potentially cause elevated market volatility in the first half of 2024. Yet, the probability of more policy hikes continues to be low, which should translate into a meaningful tailwind for leveraged credit markets. Additionally, the default outlook for 2024 is expected to be manageable and similar to 2023. Despite the presence of higher policy rates compared to the last several years, high yield bond issuers' balance sheets have remained robust, and we believe that the corporate sector is expected to maintain financial discipline, with possible benefits from strategic mergers and acquisitions by higher-rated companies. Looking ahead, we are focused on maintaining a cyclical approach in the Fund, with emphasis on commodities, consumer cyclicals, and sectors benefiting from lower financing rates.

Portfolio Details as of 02/29/2024

Total Net Assets
$3.81 B
Average Effective Duration
3.37 Years
Average Maturity
5.1 Years
Number of Issues
681
Average Yield to Maturity
8.39%

Dividends & Cap Gains

Dividends & Cap Gains

Dividend Payments

Upcoming Dividend Payment Dates

Record Date Ex-Dividend Date Reinvest & Payable Date
03/30/2024 03/31/2024 03/31/2024
04/29/2024 04/30/2024 04/30/2024
05/30/2024 05/31/2024 05/31/2024
06/29/2024 06/30/2024 06/30/2024
07/30/2024 07/31/2024 07/31/2024
08/30/2024 08/31/2024 08/31/2024
09/29/2024 09/30/2024 09/30/2024
10/30/2024 10/31/2024 10/31/2024
11/29/2024 11/30/2024 11/30/2024
12/30/2024 12/31/2024 12/31/2024

Fees & Expenses

Fees & Expenses

Fund Documents

Fund Documents

0Documents selected
Portfolio Holdings 1Q
Publish Date:11/03/2015
Portfolio Holdings 3Q
Publish Date:11/03/2015
Summary Prospectus
Publish Date:11/03/2015
Statutory Prospectus
Publish Date:11/03/2015
SAI
Publish Date:11/03/2015
Annual Report
Publish Date:11/03/2015
Semi-Annual Report
Publish Date:11/03/2015
Fact Sheet
Publish Date:11/03/2015
Commentary
Publish Date:11/03/2015

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The ICE BofA Merrill Lynch U.S. High Yield Constrained Index is a capitalization-weighted index of all US dollar denominated below investment grade corporate debt publicly issued in the US domestic market. Qualifying securities must have a below investment grade rating (based on an average of Moody’s, S&P and Fitch), at least 18 months to final maturity at the time of issuance, at least one year remaining term to final maturity as of the rebalancing date, a fixed coupon schedule and a minimum amount outstanding of $100 million. The index caps individual issuer at 2%. Index constituents are capitalization-weighted, based on their current amount outstanding, provided the total allocation to an individual issuer does not exceed 2%. Issuers that exceed the limit are reduced to 2% and the face value of each of their bonds is adjusted on a pro-rata basis. The face values of bonds of all other issuers that fall below the 2% cap are increased on a pro-rata basis. In the event there are fewer than 50 issuers in the Index, each is equally weighted and the face values of their respective bonds are increased or decreased on a pro-rata basis.

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