Aperture Credit Opportunities: Commentary for Q3 2022

Quarter in Review

Volatility in financial markets continued in Q3 2022. The “most hated” rally that started towards the end of June in the US continued throughout July with other developed markets joining in the rally around the middle of July. As with most market moves this year, the rally was precipitated by a fall in US Treasury yields. The 10-year bond fell from 3% to 2.5% as investors interpreted comments from the US Fed as being dovish – perhaps a pivot was not too far away? Credit and equity markets took their cue: US HY (CDX HY) saw spreads narrow from ~500bps to the low 400s. The S&P index rallied around 20% from the lows.

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