The most attractive opportunities are in the crossover space. Forced selling triggered by downgrades has created opportunities to purchase the bonds of companies with strong balance sheets trading at 70-80 cents on the dollar. These represent potential double-digit total return opportunities, with optionality around credit improvements. The worst opportunities are in the ‘don’t fight the Fed’ trades post its market support announcement. The markets’ front running of the Fed has led to crowded positioning and indiscriminate buying in the front end of the investment grade curve, where not all credit is created equal.

Recently, the best trade was buying single-A, high-quality balance sheets at the peak of the liquidity-based sell off in the first quarter. Single A-rated bonds widened more on a percentage basis than triple Cs because of liquidity dynamics, and buying these bonds in the secondary and primary markets at deep discounts or large concessions resulted in some bonds returning over 50% in a matter of months, outperforming distressed debt, high yield bonds and equities.

It was the result of not becoming an extreme sceptic quick enough when becoming a portfolio manager. For a credit PM in particular, you have to question everything a management team tells you, and decide for yourself if they are believable or not.

I admire Jamie Dimon, as he did not have an easy path, with several setbacks, yet persisted. He has a style of saying what he believes, no matter how unpopular, and leading with common sense.

We believe the default cycle is only beginning, but in a world awash with negative yielding debt and central banks writing puts to the market, high-quality credit has many benefits and will likely go tighter. Spreads as a percentage of total yield remain historically high and are compensating for a lot of the recessionary environment. However, credit selection is paramount to avoid the coming credit impairment driven by high corporate leverage and changing consumer preferences.

Dealer trading protocol needs to change — particularly the consistency of prices and managing expectations around when you can get liquidity. It’s tough managing a bond portfolio when you have no idea if a dealer will even send a price on your bond that day, let alone try and get liquidity for it.

ESG [environmental, social and governance] adoption is accelerating because, at the end of the day, incorporating ESG in fundamental credit research is just good investing. Having the ability to innovate and structure this evolving part of the market will enable us to best serve our clients and grow our business.