High yield bonds have performed well in rising interest rate environments, compared to, for example, global investment grade bonds. This is because typically in a rising interest rate environment, the economy is doing well, and we see growth in company earnings and improvement in company fundamentals. Credit risk for companies generally decreases and so default rates tend to be lower.
In light of recent market volatility, we wanted to reassure our investors the following points on the NB Global Corporate Income Trust (ASX:NBI)
| • | NBI continues to deliver on its investment objective and has exceeded its Target Distribution for 3 consecutive years. Furthermore, NBI remains on track to achieve its Target Distribution for FY2022.* |
| • | NBI’s performance and current Target Distribution (at 4.75% p.a.) remains highly competitive versus other fixed income offerings. |
| • | NBI’s investment portfolio is well-positioned, has experienced no defaults** and we believe the fundamentals of and outlook for Global High Yield remain positive. |