Past performance does not guarantee and is not a reliable indicator of future results.

Bryan Krug is a portfolio manager for the Artisan Partners Credit Team. This podcast represents the views of Deconstructing Alpha host Geremy van Arkel and Bryan Krug as of 12 Sep 2023, which are their own, and do not necessarily represent those of Artisan Partners. The views and opinions expressed are based on current market conditions, which will fluctuate, and those views are subject to change without notice. While the information contained herein is believed to be reliable, there is no guarantee to the accuracy or completeness of any statement in the discussion. Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation. Artisan Partners is not affiliated with Frontier Asset Management.

Fixed income securities carry interest rate risk and credit risk for both the issuer and counterparty and investors may lose principal value. In general, when interest rates rise, fixed income values fall. High income securities (junk bonds) are speculative, experience greater price volatility and have a higher degree of credit and liquidity risk than bonds with a higher credit rating. Loans carry risks including insolvency of the borrower, lending bank or other intermediary. Loans may be secured, unsecured, or not fully collateralized, trade infrequently, experience delayed settlement, and be subject to resale restrictions. Private placement and restricted securities may not be easily sold due to resale restrictions and are more difficult to value.

The Secured Overnight Financing Rate (SOFR) is a broad measure of the cost of borrowing cash overnight collateralized by Treasury securities. Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) is an indicator of a company’s financial performance which is calculated by looking at earnings before the deduction of interest expenses, taxes, depreciation and amortization. Collateralized Loan Obligation (CLO) is a single security backed by a pool of debt. Internal Rate of Return (IRR) is the annual rate of growth that an investment is expected to generate. Loan-to-Value (LTV) Ratio is an often used ratio in mortgage lending to determine the amount necessary to put in a down payment and whether a lender will extend credit to a borrower. 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. Yield to Worst (YTW) is the lowest potential yield that can be received on a bond without the issuer actually defaulting. Credit Quality ratings from ratings agencies typically range from AAA (highest) to D (lowest) and are subject to change. Spread is the difference in yield between two bonds of similar maturity but different credit quality. Duration is a measure of the price sensitivity of a bond to interest rate movements.

This material is provided for informational purposes without regard to your particular investment needs. This material shall not be construed as investment or tax advice on which you may rely for your investment decisions. Investors should consult their financial and tax adviser before making investments in order to determine the appropriateness of any investment product discussed herein.