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MainStay High Yield Corporate Bond Fund
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Transcript of MainStay High Yield Corporate Bond Fund
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
MainStayHigh Yield Corporate Bond Fund
TICKERS: A: MHCAX INV: MHHIX C: MYHCX I: MHYIX R1: MHHRX R2: MHYRX R6: MHYSX
1628506 MSHY31b-11/15
Subadvised by:
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
High Yield Investment Team and Coverage
Team of Seasoned Credit Investors
Won Choi, CFAManaging Director
Chemicals, Metals/Mining
18 Years Experience
Michael A. SnyderManaging Director
Aerospace/Defense, Consumer Prod./Food Manufacturing, Media28 Years Experience
James S. WolfManaging Director
Healthcare
28 Years Experience
Dohyun Cha, CFAManaging Director
Energy
18 Years Experience
Nate Hudson, CFAManaging Director
Auto/Transportation, Services
24 Years Experience
Eric GoldManaging Director
Cable/Broadcasting, Technology,
Telecommunications28 Years Experience
Andrew SusserExecutive Managing Director
Lead Portfolio Manager
29 Years Experience
Scott MallekManaging Director
Trader19 Years Experience
J. Alex LeitesDirectorTrader
22 Years Experience
Thomas MetcalfAssociate DirectorResearch Analyst
4 Years Experience
Richard LeeAssociate
Trader
1 Year Experience
Ryan Bailes, CFADirectorGaming,
Paper/Packaging, Utilities, Homebuilding
20 Years Experience
2
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
All numbers and ranges referred to above are approximations only, and assume normal market conditions and the application of MacKay Shields standard investment guidelines. In addition, the 200 – 225 range for high yield portfolio issuers referred to above is an approximation of the average number of issuers in a typical portfolio over a rolling three year period only. Unusual market conditions, client cash flow activity, compliance with specific client instructions and other factors may cause the number of issuers in the portfolio to fall outside this approximate range during any given rolling three year period. There can be no assurance that investment objectives will be met.
High Yield Investment ProcessMeet minimum
yield requirement
Reduce risk throughdiversification
Sector weighting limitsIndividual issue
limit
O B J E C T I V E S C R I T E R I A
HIGH YIELDFOCUS LIST
Relative value
H I G H Y I E L D U N I V E R S E
M A R G I N – O F – S A F E T YF I N A N C I A L A N A L Y S I S
B U S I N E S S J U D GE M E N T
C A T A L Y S T
VALUE-ORIENTED SECURITY SELECTION PROCESS
Control default risk
Identify strategic companies
Identify improving credits
H I G H Y I E L DP O R T F O L I O
Quality of business
Excess asset coverage(i.e. Loan to Value)
Generally YTM >200 bpsover comparable Treasury
Minimum issue size of $150 million
Generally exclude illiquid
issues
Free cash flow
Capital structure
Direction of business Free cash flow used to retire 1/2 of debt in 5 yearsCompany willingness to access equity markets
Management intent
3
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
We Develop a Thorough Understanding of Risk
Group 2 – Seasoned Issuers Significant equity value Strong credit statistics Strong asset value Group 2 is comprised of: Rated BB 5%, Rated
B 25%, Rated CCC 6%, NR <1%
1 NR = 4.2% of portfolio. Percentage totals may not sum to 100% due to rounding.
Every Holding Is in One of Four Risk Groups
Group 3 – Risk Credits Trading at discount More research intensive High yielding relative to universe Group 3 is comprised of: Rated BB <1%, Rated
B 6%, Rated CCC 7%, Rated NR 1%
Group 1 – Highest Quality Strongest credit profile Lowest volatility Group 1 is comprised of: Rated A <1%, Rated
BBB 4%, Rated BB 27%, Rated B 14%, NR 1%
Group 4 – Special Situations Significant discount to asset value Group 4 is comprised of: Rated CCC <1%, NR
1%
Current Holdings1 (September 30, 2015)
Group 147%
Group 237%
Group 315%
Group 41%
4
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
MainStay High Yield Corporate Bond Fund: Characteristics
Statistics as of September 30, 2015 Quality Exposure (%)
1. Lower quality rating if split-rated
Cash
BBB & Above¹
BB
B
CCC & Below
NR
3.9
4.1
31.7
43.5
12.9
3.9
0.0
35.7
42.7
21.1
0.6
Credit Suisse High Yield IndexMainStay High Yield Corporate Bond Fund
MainStay High Yield Corporate Bond Fund
Credit SuisseHigh Yield Index
Current Yield (%) 6.84% 7.47%Yield to Worst (%) 7.40% 8.39%Modified Duration (years) 3.95 4.18
Energy 11.7 13.9Healthcare 8.2 8.3Transportation 7.8 4.2Service 7.2 6.0Housing 6.4 4.6Communications 6.4 7.8Cable/Wireless Video 6.3 3.2Financial 6.2 6.1Metals/Minerals 5.8 4.6Information Technology 5.1 5.9
Top Ten Industries (%)
5
Portfolio data is as of 9-30-2015 and subject to change on a daily basis. Past performance is no guarantee of future results, which will vary. It is not possible to invest directly in an index. Current yield is Annual income (interest or dividends) divided by the current price of the security. This measure looks at the current price of a bond instead of its face value and represents the return an investor would expect if he or she purchased the bond and held it for a year. Yield-to-worst is the lowest potential yield that can be received on a bond without the issuer actually defaulting. Modified duration is inversely related to the approximate percentage change in price for a given change in yield.
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
MainStay High Yield Corporate Bond Fund: Performance
5 Years Ending September 30, 2015
MainStay High Yield Corporate Bond Fund
(A Shares at NAV) Credit Suisse High
Yield Index
Peer Group (Morningstar High Yield Bond Funds)
Returns 5.77% 5.93% 5.23%
Standard Deviation 4.55% 5.71% 5.85%
Alpha 1.03% 0.0% -0.76%
Beta 0.79 1.00 1.02
Up Market Capture 94.89 100.0 85.99
Down Market Capture 67.77 100.0 89.11
Risk-adjusted Returns
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Source: Morningstar Direct, 9/30/15. Past performance is no guarantee of future results, which will vary. It is not possible to invest directly in an index. Standard Deviation measures how widely dispersed a fund'sreturns have been over a specified period of time. A high standard deviation indicates that the range is wide, implying greater potential for volatility. Alpha measures a fund's risk-adjusted performance and is expressed as an annualized percentage. Beta is a measure of historical volatility relative to an appropriate index (benchmark) based on its investment objective. A beta greater than 1.00 indicates volatility greater than the benchmark's. Upside/Downside Market Capture measures a manager's performance in up/down markets relative to the fund's benchmark. The Credit Suisse High Yield Index is a market-weighted index that includes publicly traded bonds rated below BBB by S&P and Baa by Moody’s. An investment cannot be made directly into an index. The Morningstar High Yield Bond Category average represents those portfolios that primarily invest in U.S. high-income debt securities where at least 65% or more of bond assets are not rated or are rated by a major agency, such as Standard & Poor’s or Moody’s, at the level of BB (considered speculative for taxable bonds) and below.
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
Performance data quoted represents past performance. Past performance is no guarantee of future results. Due to market volatility, current performance may be less or higher than the figures shown. Investment return and principal will fluctuate so that upon redemption, shares may be worth more or less than their original cost. Returns shown at NAV do not reflect deduction of sales charges which would lower performance. For performance information current to the most recent month-end, please visit our web site at mainstayinvestments.com.
Source: Lipper Inc., is an independent fund performance monitor. Results are based on total returns with capital gain and dividend distributions reinvested and do not reflect any deduction of sales charges. Lipper numbers are based on the Fund’s total-return rank for the specified time period relative to all funds that have the same Lipper category. The highest (or most favorable) percentile rank is 1 and the lowest (or least favorable) percentile rank is 100. The top-performing fund in a category will always receive a rank of 1. Percentile ranks within categories are most useful in those categories that have a large number of funds.
Performance charges for A shares might have been less favorable had sales charges been included.
Performance Period
MainStay High Yield Corporate Bond Fund
Lipper Average High Yield Fund
Lipper Percentile in Peer Group
Lipper Ranking in Peer Group
Credit Suisse High Yield Index
1 Year -1.19% -3.77% 17th 109 / 653 -3.96%
3 Years 3.32% 2.81% 34th 175 / 524 3.30%
5 Years 5.77% 5.18% 29th 219 / 375 5.93%
10 Years 6.07% 5.87% 42nd 119 / 289 6.89%
Annualized as of September 30, 2015 Class A Shares at NAV
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MainStay High Yield Corporate Bond Fund: Performance
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
SEC Average Annual Total Returns
Performance data quoted represents past performance. Past performance is no guarantee of future results. Due to market volatility, current performance may be less or higher than the figures shown. Investment return and principal will fluctuate so that upon redemption, shares may be worth more or less than their original cost. For performance information current to the most recent month-end, please visit our web site at mainstayinvestments.com. Total annual operating expenses are: Class A: 0.99%, Investor Class: 1.01%, Class B: 1.76%, Class C: 1.76%, Class I: 0.74%, Class R1: 0.84%, Class R2: 1.09%, Class R6: 0.58%.These results include the maximum initial sales charge for Class A shares of 4.5% and show the percentage change for each of the required periods with capital gain and dividend distributions reinvested.Performance for Class A shares includes the historical performance of Class B shares from inception 5/1/86 through 12/31/94, adjusted to reflect the applicable sales charge (or CDSC) and fees and expenses for such shares.
The 30-day SEC yield calculation is based on a 30-day period ending on the last day of the month. It is computed by dividing the net investment income per share earned during the period by the maximum offering price per share on the last day of the period.
Annualized as of September 30, 2015 Class A Shares Net of 4.5% Maximum Sales Charge
Performance Period MainStay High Yield Corporate Bond Fund
1 Year -5.64%
3 Years 1.74%
5 Years 4.80%
10 Years 5.58%
Since Inception (1/ 03/ 95) 8.27%
30-Day SEC Yield as of 9/ 30/ 15 5.55%
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FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
As of September 30, 2015. Mainstay High Yield Corporate Bond Fund data is as of 9-30-2015 and subject to change on a daily basis. Past performance is no guarantee of future results, which will vary. It is not possible to invest directly into an index. This document is for informational purposes only. 1. Source: MacKay Shields High Yield Team using Credit Suisse High Yield Index data, Bloomberg.2. Percentage based on par amount outstanding. Bonds at distressed levels defined as issues that trade at a spread-to-worst over US treasuries greater than 1,000 bps.
Index Subsector1
Mainstay High Yield Corporate Bond Fund
(%)
Index Weight
(%)
Index Yield to
Worst (%)
Average Dollar Price
($)2
Index (%) Trading Distressed2
Exploration & Production 7.7 7.3 14.8 62.99 56.1
Other Energy (incl. Midstream
and Pipeline)2.6 3.4 7.2 93.29 0.0
Refining 0.7 1.0 7.8 89.06 16.6
Service & Equipment 0.6 2.3 17.7 65.37 74.6
All Energy 11.6 13.9 13.0 70.32 47.1
Energy is Made Up of Several Subsectors
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FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
Average Annual Total Returns as of 9/30/15
MainStay High Yield Corporate Bond Fund
Performance data quoted represents past performance. Past performance is no guarantee of future results. Due to market volatility, current performance may be less or higher than the figures shown. Investment return and principal value will fluctuate so that upon redemption, shares may be worth more or less than their original cost. For performance information current to the most recent month-end, please visit our web site at mainstayinvestments.com.Total annual operating expenses are: Class A: 0.99%, Investor Class: 1.01%, Class B: 1.76%, Class C: 1.76%, Class I: 0.74%, and C lass R2: 1.09%.Average annual total returns include the change in share price and reinvestment of dividends and capital gain distributions. Performance for Class A, C, and I shares includes the historical performance of Class B shares from inception (5/1/86) through 12/31/94 for Class A, through 8/31/98 for Class C, and through 12/31/03 for Class I, adjusted to reflect the applicable sales
charge (or CDSC) and fees and expenses. Performance for Investor Class shares includes the historical performance of Class A shares from inception through 2/27/08 adjusted to reflect the applicable fees and expenses. Class I shares are generally available only to corporate and institutional investors.
MainStay High Yield Corporate Bond Fund Share Class 1 year 3 years 5 years 10 years Since InceptionNAV (Inception)
Class A (1/3/95) -1.19% 3.32% 5.77% 6.07% 8.44% Investor Class (2/28/08) -1.14% 3.30% 5.72% 6.03% 8.43% Class B (5/1/86) -2.02% 2.51% 4.92% 5.23% 7.65% Class C (9/1/98) -2.02% 2.51% 4.61% 5.23% 7.65% Class I (1/2/04) -0.94% 3.57% 5.99% 6.33% 8.70% Class R2 (5/1/08) -1.29% 3.22% 5.64% 5.96% 8.37%
With Sales Charges Class A (max. 4.5% load) -5.64% 1.74% 4.80% 5.58% 8.27% Investor Class (max. 4.5%
load) -5.59% 1.73% 4.75% 5.55% 8.26% Class B (max. 5% CDSC) -6.65% 1.64% 4.61% 5.23% 7.65% Class C (max. 1% CDSC) -2.95% 2.51% 4.92% 5.23% 7.65% Class I (no-load) -0.94% 3.57% 5.99% 6.33% 8.70% Class R2 (5/1/08) -1.29% 3.22% 5.64% 5.96% 8.37%
Standardized Performance
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FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
High Yield Overview
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
448565
622 649754
870 902 892 942 946 962 944
1,1111,229
1,289
1,429
1,5621,648
Source: JP Morgan, 12/31/14.
Growth of US High Yield Market
HY Market Size ($ billions) HY Investor Base 2014
12
Hedge Funds and Other3% High Yield
Mutual Funds21%
Insurance Companies
24%Pension Funds23%
Investment Grade Funds
7%
Equity and Income Funds
4%
Foreign16%
ETFs3%
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
High Yield Spreads and Default Rates
Source: BofA Merrill Lynch, 9/30/15. Past performance is no guarantee of future results, which will vary. Default rate is the rate of borrowers who fail to remain current on their loans. It is a critical piece of information used by lenders to determine their risk exposure and economists to evaluate the health of the overall economy. Spread to worst is the difference in overall returns between two different classes of securities, or returns from the same class, but different representative securities. The spread to worst measures the difference from the worst performing security to the best, and can be seen as a measure of dispersion of returns within a given market or between markets. Median refers to the middle number in a sorted list of numbers.
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1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 20150
400
800
1,200
1,600
2,000
0.0
4.0
8.0
12.0
16.0
20.0Issuer Default Rate Spread to Worst
Spre
ad T
o W
orst
(bp
s) Default Rate (%
)
Current Spread: 654 bpsLong Term Median: 532 bps
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
Quality of High Yield New Issuance Has ImprovedNew Issue Volume ($ billions) 2013 – YTD
2015
2007
As of September 30, 2015Source: JP Morgan
BB and Higher 30.4%
B54.5%
CCC14.0%
Not Rated1.1%
BB and Higher54.2%
B36.4%
CCC8.5%
Not Rated0.9%
14
1997199
8199
9200
0200
1200
2200
3200
4200
5200
6200
7200
8200
9201
0201
1201
2201
3201
4
YTD 20
15
126151
100
47
9568
152158
106
149 148
53
181
302
243
368
399
356
251
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
LBO Financings are Smaller Portion of New Issuance
LBO Acquisition % of New Issuance
2007 Largest New Issuers Past Two Years Largest New Issuers
TXU (LBO) Charter Communications
Freeport McMoran GM/GM Finance
HD Supply (LBO) Valeant Pharmaceuticals
Realogy (LBO) Frontier Communications
First Data (LBO) HCA Inc.
Source: Credit Suisse . 9/30/15. Leveraged Buyout (LBO) is the acquisition of another company using a significant amount of borrowed money (bonds or loans) to meet the cost of acquisition.
15
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 YTD 2015
14.3%
24.1%26.1%
28.1%
14.2%
0.6%4.7%
7.3% 6.7% 6.4% 5.2% 4.9%
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
Food
& D
rug
Food
/Tob
acco
Gaming
/Leis
ure
Hous
ing
Reta
ilHe
althc
are
Cons
umer
Prod
ucts
Finan
cial
Man
ufac
turin
gTr
ansp
orta
tion
CS H
Y Ind
ex Ex
. Ene
rgy/
Met
als/M
inera
ls
Servi
ce
Infor
mati
on Te
chno
logy
Fore
st Pr
od./C
onta
iners
Aero
spac
eM
edia/
Telec
omCS
HY I
ndex
Utility
Chem
icals
Ener
gyM
etals
/Mine
rals
(20.0)
(17.5)
(15.0)
(12.5)
(10.0)
(7.5)
(5.0)
(2.5)
0.0
2.5
5.0
7.5
10.0
0.65%
(2.42)%
(2.14)% (5.17)%
YTD Return % Q3 Return %
Tota
l Ret
urn
(%)
From January 1, 2015 to September 30, 2015. Source: Credit Suisse High Yield Index. Sorted by highest year-to-date total return. Past performance is no guarantee of future results, which will vary. It is not possible to invest directly into an index.
16
High Yield Sector Performance
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
Andrew SusserSenior Managing DirectorPortfolio Manager/Analyst
Andrew Susser is a Senior Managing Director and Portfolio Manager/Research Analyst for the High Yield Team, where he helps manage high yield bond investments and follows the gaming, leisure, retail and food sectors. Prior to joining MacKay Shields in 2006, he was a Portfolio Manager with GoldenTree Asset Management. Previously, he was a Managing Director and Head of High Yield Bond Research at Banc of America Securities covering the gaming, lodging and leisure sectors. From 1999 to 2004, Andrew was named to the Institutional Investor All-America Fixed Income Research Team; from 2002 to 2004, he was ranked by Institutional Investor as the No. 1 analyst in the high yield sector. Andrew also worked as a Fixed Income Analyst for Salomon Brothers, as a Senior Analyst at Moody’s Investors Service and as a Market Analyst and Institutional Trading Liaison for Merrill Lynch Capital Markets. Andrew is a member of the firm’s Management Committee. He began his career as a Corporate Finance and M&A Attorney at Shearman & Sterling in their New York office. Andrew received a BA from Vassar College, an MBA from the Wharton Graduate School of Business and a JD from the University of Pennsylvania Law School. He has been working in the investment industry since 1986.
Dohyun Cha, CFAManaging DirectorPortfolio Manager/Analyst
Dohyun Cha is a Managing Director and Portfolio Manager/Research Analyst for the High Yield Team, where he helps manage high yield bond investments and follows the energy and utility sectors. Prior to joining MacKay Shields in 2006, he was a Vice President and Equity Analyst at Credit Suisse. Previously, he was a Financial Analyst at CIBC World Markets. Dohyun received a BS from Boston College and is a CFA Charterholder. He has been working in the investment industry since 1997.
Won Choi, CFAManaging DirectorPortfolio Manager/Analyst
Won Choi is a Managing Director and Portfolio Manager/Research Analyst for the High Yield Team, where he helps manage high yield bond investments and follows the chemicals, metals and paper & packaging sectors. Prior to joining MacKay Shields in 2002, he was a Private Equity Associate at Fenway Partners, Inc. Previously, he was a Financial Analyst in the Financial Entrepreneurs Group at Salomon Smith Barney. Won received a BA from Yale University and is a CFA Charterholder. He has been working in the investment industry since 1997.
BiographiesHigh Yield Team
17
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
Eric GoldManaging DirectorPortfolio Manager/Analyst
Eric Gold is a Managing Director and Portfolio Manager/Research Analyst for the High Yield Team, where he helps manage high yield bond investments and follows the cable TV, broadcasting, technology and telecommunications sectors. Prior to joining MacKay Shields in 2010, he was a sell-side Analyst covering the telecommunications, cable and media sectors at Sterne Agee & Leach, Inc. Previously, he was an Analyst at BlackRock and a sell-side Analyst at Grantchester Securities where he was ranked by Institutional Investor as the #1 analyst in the wireless telecommunications sector for 1999, 2000, 2001 and 2002. Eric received a BA from Vassar College and an MBA from New York University. He has been working in the investment industry since 1987.
Nate Hudson, CFAManaging DirectorPortfolio Manager/Analyst
Nate Hudson is a Managing Director and Portfolio Manager/Research Analyst for the High Yield Team, where he helps manage high yield bond investments and follows the automotive/transportation, building materials and homebuilding sectors. Prior to joining MacKay Shields in 2008, he was a Senior Analyst of High Yield Credit in Strategic Capital’s (White Ridge Advisors) proprietary investment group at Banc of America Securities. Previously, he was a sell-side High Yield Analyst at Banc of America Securities and a High Yield Credit Analyst at Nomura Corporate Research & Asset Management (NCRAM).Nate received a BA from Yale University and is a CFA Charterholder. He has been working in the investment industry since 1991.
Michael A. SnyderManaging DirectorPortfolio Manager/Analyst
Michael Snyder is a Managing Director and Portfolio Manager/Research Analyst for the High Yield Team, where he helps manage high yield bond investments and follows the aerospace/defense, consumer products, manufacturing and diversified media sectors. Prior to joining MacKay Shields in 2006, he was a Managing Director with AllianceBernstein as the Director of their Global High Yield Group. Previously, he was a Managing Director with both DLJ Asset Management and Bear Stearns Asset Management Group as the Director for DLJ’s Leverage Investment Group and Director of Bear Stearns High Yield Investment Group, and a Senior Vice President with Prudential Insurance Company of America, first in Merchant Banking and then High Yield Investments. Michael received a BA from Dickinson College and an MBA from Duke University’s Fuqua School of Business. He has been working in the investment industry since 1987.
BiographiesHigh Yield Team
18
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
James S. WolfManaging DirectorPortfolio Manager/Analyst
Jim Wolf is a Managing Director and Portfolio Manager/Research Analyst for the High Yield Team, where he helps manage high yield bond investments and follows the finance and healthcare sectors. Prior to joining the MacKay Shields in 2006, he was a Managing Director and Director of Research at First Albany Capital. Previously, he was a Director with RBC Capital Markets First Albany and a Managing Director of High Yield Research at Bear, Stearns & Co. Jim received a BA from Northwestern University and an MBA from the University of Rochester’s Simon School of Business. He has been working in the investment industry since 1987.
Thomas MetcalfAssociateResearch Analyst
Tom Metcalf is an Associate and Research Analyst for the High Yield Team. Prior to joining MacKay Shields in 2011, he was a Content Publisher at iO Global Ltd. Tom received a BS and an MS from the University of Durham. He has been working in the investment industry since 2011.
Scott D. MallekDirectorTrader
Scott Mallek is a Director and Trader for the High Yield Team. Prior to joining MacKay Shields in 2002, he was an Assistant Vice President involved with IFG High Yield Trading at Salomon Smith Barney. Scott received a BA from Fairfield University and has been working in the investment industry since 1996.
Alex LeitesAssociate DirectorTrader
Alex Leites is an Associate Director and Trader for the High Yield Team. Prior to joining MacKay Shields in 2002, he was a Settlements Specialist at Credit Suisse First Boston. He previously worked at Kinexus, Inc., Bank of New York, Lazard Asset Management and Prudential Securities. Alex received a BS from New York University’s Stern School of Business and has been in the investment industry since 1993.
BiographiesHigh Yield Team
19
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
MacKay Shields believes the best way to maximize returns is to minimize default risk/loss
MacKay Shields has managed high yield portfolios since 1991 with a disciplined investment process focused on risk control.
Experience matters — the investment professionals have an average of 22 years of investment experience.
Past performance is no guarantee of future results. There can be no guarantee that investment objectives will be met.
Why MacKay Shields?
20
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
DisclosuresAbout RiskForeign securities can be subject to greater risks than U.S. investments, including currency fluctuations, less liquid trading markets, greater price volatility, political and economic instability, less publicly available information, and changes in tax or currency laws or currency laws or monetary policy. These risks are likely to be greater for emerging markets than in developed markets.
High yield securities (“junk bonds”) have speculative characteristics and present a greater risk of loss than higher quality debt securities. These securities can also be subject to greater price volatility.
Funds that invest in bonds are subject to interest-rate risk and can lose principal value when interest rates rise. Bonds are also subject to credit risk, in which the bond issuer may fail to pay interest and principal in a timely manner
Floating rate loans are generally considered to have speculative characteristics that involve default risk of principal and interest, collateral impairment, borrower industry concentration, and limited liquidity. Issuers of convertible securities may not be as financially strong as those issuing securities with higher credit ratings and are more vulnerable to changes in the economy.
21
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
DisclosuresDefinitionsCredit Suisse High Yield Index is a is a market-weighted index that includes publicly traded bonds rated below BBB by S&P and Baa by Moody’s.
Lipper defines the High Current Yield Funds Category as Funds that aim at high (relative) current yield from fixed income securities, have no quality or maturity restrictions, and tend to invest in lower-grade debt issues.
Standard Deviation measures how widely dispersed a fund's returns have been over a specified period of time. A high standard deviation indicates that the range is wide, implying greater potential for volatility.
Alpha measures a fund's risk-adjusted performance and is expressed as an annualized percentage.
Beta is a measure of historical volatility relative to an appropriate index (benchmark) based on its investment objective. A beta greater than 1.00 indicates volatility greater than the benchmark's.
Upside/Downside Market Capture measures a manager's performance in up/down markets relative to the fund's benchmark.
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FOR REGISTERED REPRESENTATIVE USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC.
Please ask your clients to consider the investment objectives, risks, charges, and expenses of the investment company carefully before investing. The prospectus or summary prospectus contains this and other information about the fund and can be obtained by contacting you, the financial professional. Instruct your clients to read the prospectus or summary prospectus carefully before investing.
mainstayinvestments.com
New York Life Investments engages the services of MacKay Shields LLC, an affiliated federally registered advisor, to subadvise the Fund. MainStay Investments® is a registered service mark and name under which New York Life Investment Management LLC does business. MainStay Investments, an indirect subsidiary of New York Life Insurance Company, New York, NY 10010, provides investment advisory products and services. The MainStay Funds ® are managed by New York Life Investment Management LLC and distributed by NYLIFE Distributors LLC, 169 Lackawanna Avenue, Parsippany, NJ 07054, a wholly owned subsidiary of New York Life Insurance Company. NYLIFE Distributors LLC is a Member FINRA/SIPC.
MainStay FundsFor More Information
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