LHYRX | High Yield Fund Class R3 | 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.

Yield

Average Yield to Maturity as of 08/31/2023

8.40%

30-Day Standardized Yield 1 as of 08/31/2023  

6.85%

Fund Basicsas of 08/31/2023

Total Net Assets
$4.12 B
Inception Date
09/28/2007
Dividend Frequency
Monthly
Fund Gross Expense Ratio
1.20%
Fund Net Expense Ratio
1.20%
Number of Holdings
686

Fund Expense Ratio :

Gross 1.20%

Net 1.20%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 09/28/2007
w/o sales charge 4.65% 3.75% 0.19% 1.33% 3.57% 5.35%
Lipper Category Avg. High Yield Funds 6.47% 6.26% 1.72% 2.78% 3.62% -
ICE BofA U.S. High Yield Constrained Index 7.29% 7.11% 1.90% 3.16% 4.39% 6.02%
w/ sales charge 4.65% 3.75% 0.19% 1.33% 3.57% 5.35%

Fund Expense Ratio :

Gross 1.20%

Net 1.20%

Fund Expense Ratio :

Gross 1.20%

Net 1.20%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 09/28/2007
w/o sales charge 3.87% 5.96% 2.20% 1.58% 3.62% 5.36%
Lipper Category Avg. High Yield Funds 4.75% 8.01% 3.03% 2.77% 3.58% -
ICE BofA U.S. High Yield Constrained Index 5.45% 8.97% 3.23% 3.18% 4.34% 5.97%

Fund Expense Ratio :

Gross 1.20%

Net 1.20%

Type Assets
High Yield Bonds
Equity
Bank Loans
Investment Grade Bonds
Convertibles
Other
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 08/31/2023 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 78 Investment Professionals with 17 Years Avg. Industry Experience

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Performance

Performance

Average Yield to Maturity as of 08/31/2023

8.40%

30-Day Standardized Yield 1 as of 08/31/2023  

  Subsidized2 Un-Subsidized3
w/o sales charge 6.85% 6.85%

Fund Expense Ratio :

Gross 1.20%

Net 1.20%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 09/28/2007
w/o sales charge 4.65% 3.75% 0.19% 1.33% 3.57% 5.35%
Lipper Category Avg. High Yield Funds 6.47% 6.26% 1.72% 2.78% 3.62% -
ICE BofA U.S. High Yield Constrained Index 7.29% 7.11% 1.90% 3.16% 4.39% 6.02%
w/ sales charge 4.65% 3.75% 0.19% 1.33% 3.57% 5.35%

Fund Expense Ratio :

Gross 1.20%

Net 1.20%

Fund Expense Ratio :

Gross 1.20%

Net 1.20%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 09/28/2007
w/o sales charge 3.87% 5.96% 2.20% 1.58% 3.62% 5.36%
Lipper Category Avg. High Yield Funds 4.75% 8.01% 3.03% 2.77% 3.58% -
ICE BofA U.S. High Yield Constrained Index 5.45% 8.97% 3.23% 3.18% 4.34% 5.97%

Fund Expense Ratio :

Gross 1.20%

Net 1.20%

Year Fund Returns ICE BofA U.S. High Yield Constrained Index
2022 -14.04% -11.16%
2021 5.83% 5.35%
2020 4.19% 6.07%
2019 14.68% 14.41%
2018 -5.49% -2.27%
2017 8.17% 7.48%
2016 15.62% 17.49%
2015 -2.49% -4.61%
2014 3.18% 2.51%
2013 9.35% 7.41%
2012 16.12% -
2011 2.89% -
2010 13.96% -
2009 50.25% -
2008 -23.27% -
2007 1.67% -
Year Q1 Q2 Q3 Q4 Yearly Returns
2023 2.77% 1.07% - - 3.14%
2022 -5.47% -10.86% -1.37% 3.42% -14.04%
2021 1.65% 3.02% 0.56% 0.49% 5.83%
2020 -16.75% 10.76% 5.58% 7.01% 4.19%
2019 7.39% 3.69% 0.21% 2.78% 14.68%
2018 -1.25% -0.10% 2.46% -6.49% -5.49%
2017 2.74% 1.77% 2.50% 0.93% 8.17%
2016 1.93% 5.42% 5.37% 2.11% 15.62%
2015 3.10% 0.66% -4.27% -1.86% -2.49%
2014 2.84% 3.30% -1.88% -1.01% 3.18%
2013 3.89% -0.97% 2.43% 3.77% 9.35%
2012 6.53% 0.30% 4.97% 3.53% 16.12%
2011 3.74% 1.00% -7.04% 5.64% 2.89%
2010 4.84% -0.98% 6.24% 3.32% 13.96%
2009 6.06% 17.31% 13.88% 6.04% 50.25%
2008 -3.46% 1.96% -7.56% -15.67% -23.27%
2007 2.93% 0.13% -0.15% -1.21% 1.67%

NAV Historical Prices

Date Net Asset Value

Portfolio

Portfolio

Rating Assets
High Yield Bonds
Equity
Bank Loans
Investment Grade Bonds
Convertibles
Other
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 08/31/2023

Rating Assets
BBB
BB
B
<B
Not Rated

Portfolio Positioning as of 06/30/2023

  • The Fund continued to be focused on higher carry, shorter duration securities. High yield spreads have grinding tighter throughout the first half of the year, finishing slightly above 400 bps in June. With declining recessionary concerns helping to compress spreads, our primary focus has shifted towards carry opportunities within the high yield universe. As primary markets have stabilized somewhat after a very slow 2022, we see the new issue high yield market as a strong source of carry. We added to the Fund’s Single-B credit exposure throughout the period, which we view as offering attractive yields to support this carry trade, and monetized positions in BBs as a source of funds that exhibited tight valuations. We also continue to prioritize sufficient liquidity given uncertainty with market reactions to Fed policy pause.
  • We see opportunity in the Leisure and Capital Goods sectors, while limiting exposure to the Media space. While Energy remains the Fund’s top overweight position, we continue to favor investments in the Leisure and Capital Goods sectors. In Leisure, resilient demand for summer travel, a strong film slate, and return to the box office continue to be reasons we see opportunities in the sector. In Capital Goods, the Fund covered underweights in areas like Aerospace/Defense and Packaging, while remaining overweight the Diversified Capital Goods and Machinery subsectors. The Fund maintained an underweight in sectors like media, where companies continued to struggle amid ongoing recessionary concerns. The Fund remains underweight the Media Content subsector, particularly as issuers reliant on advertising sales have been more sensitive to economic pullbacks. We expect these pressures to remain going forward.
  • The Fund increased its allocation to out-of-index sectors. We generally believe that select exposures to these sectors can offer attractive risk-reward opportunities, potential Fund diversification benefits and avenues for liquidity. The Fund increased modest allocations to common stock, convertible bonds, and bank loans throughout the quarter. Equity-exposure came off of recent lows, and allocations focused more broadly on growthier sectors of the market, which have exhibited the most resilient performance so far this year. While the Fund has the flexibility to toggle allocations to off-benchmark asset classes, we maintained the majority of exposure in traditional high yield corporate bonds.
  •  Looking forward, we believe that high yield bonds may provide an opportunity to capture high-quality carry and equity-like returns. High yield has performed well during the first half of 2023 as positive developments in macroeconomic data have broadly counteracted recession concerns. However, we continue to monitor for signs of rising credit stress given the surge in interest rates and tightening in credit lending over the last 12 months. As a reflection of this stance, we enter the back half of the year modestly underweight the lowest segment of CCC bonds in the high yield strategy. A growth slowdown and deterioration in credit metrics, particularly within CCCs, could potentially lead to the default rate climbing towards the long-term average above 3% in the second half of 2023 into 2024. However, it is important to consider that U.S. high yield issuers overall continue to boast much stronger balance sheets in aggregate than at the start of prior slowdowns, with leverage and interest rate coverage around their strongest levels since post-GFC. The high yield index also has maintained its higher quality tilt in recent months with approximately 50% comprised of BBs. Additionally, a starting YTW for the asset class north of 8% has historically translated into strong forward returns for investors. While there are many variables in every default cycle, we believe the high yield asset class can continue to be an attractive carry opportunity for investors, particularly if high yield spreads remain relatively range bound in the near term.

 

 

Portfolio Details as of 08/31/2023

Total Net Assets
$4.12 B
Average Effective Duration
3.65 Years
Average Maturity
5.3 Years
Number of Issues
686
Average Yield to Maturity
8.40%

Dividends & Cap Gains

Dividends & Cap Gains

Dividend Payments

Dividend Payments

For
YTD Dividends Paidas of 09/28/2023
$0.25220
Dividend Frequency
Monthly (Daily Accrual)
Record Date Ex-Dividend Date Reinvest & Payable Date Dividend Reinvest Price
Daily Daily 08/31/2023 $0.03365 $6.17
Daily Daily 07/31/2023 $0.03261 $6.23
Daily Daily 06/30/2023 $0.03223 $6.19
Daily Daily 05/31/2023 $0.03216 $6.13
Daily Daily 04/30/2023 $0.03186 $6.24
Daily Daily 03/31/2023 $0.02971 $6.22
Daily Daily 02/28/2023 $0.03108 $6.17
Daily Daily 01/31/2023 $0.02892 $6.31

Upcoming Dividend Payment Dates

Record Date Ex-Dividend Date Reinvest & Payable Date
Daily Daily 09/30/2023
Daily Daily 10/31/2023
Daily Daily 11/30/2023
Daily Daily 12/31/2023

Capital Gains Distributions

For
Record Date Reinvest & Payable Date Long-term Short-term * Total Reinvest Price
12/16/2021 12/17/2021 - $0.0100 $0.0100 $7.49

Fees & Expenses

Fees & Expenses

Expense Ratioas of 08/31/2023

Fund Gross Expense Ratio Fund Net Expense Ratio
1.20% 1.20%

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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