May 2026 data
Against the backdrop of roaring equity markets, bonds seemed to be reading a different script in May. Although interest rates were largely unchanged at month end, there was significant variability throughout the month as fears of a sustained energy shock pushed interest rates higher before falling again as ceasefire talks between the U.S. and Iran gained momentum and the spike in oil prices reversed.
Credit spreads continued to take cues from equity markets and remained tight throughout the month with very little volatility. The resultant index performance at the end of May was universally strong: the Bloomberg US Corporate Total Return Unhedged was up 0.8% while the Intermediate Credit Indices rose 0.3%. European credit outpaced its US counterparts with a 0.9% gain on the month. High Yield markets also rebounded strongly on the month with the Bloomberg Global High Yield index up 0.7% and the Bloomberg Pan-European High Yield index up 0.9%.
Source: Bloomberg as of May 29, 2026
Despite spreads rebounding to tight levels, all-in yields remain at attractive levels for investors, up between 50–60 bps from the beginning of the year. The Persian Gulf conflict has caused forward interest rate expectations to move, with the market now pricing in interest rate hikes in Europe. This narrowing of the rate differential with the U.S. has continued to push the headwind of hedging U.S. Dollars for European investors down to 1.48% at the end of May from 1.54% at the end of April.
Source: Bloomberg as of May 29, 2026
The careful credit selection within the iMGP US Core Plus Fund has resulted in a portfolio producing yields in line with the US Corporate Index: however, it does so at almost half the duration. With absolute yields now above 5%, we believe the fund represents an attractive opportunity. For European investors, the declining cost of currency hedging further enhances the appeal of the asset class, which offers both diversification benefits and compelling levels of yield in excess of those available from domestic markets.
| iMGP US Core Plus Fund | Bloomberg Euro Corporate Unhedged EUR | Bloomberg US Corporate Total Return Value Unhedged USD | Bloomberg U.S. Intermediate Credit TR Index Value Unhedged | Bloomberg Swiss Franc Aggregate Total Return Index Value Unhedged CHF | |
|---|---|---|---|---|---|
| Yield to Worst | 5.11 | 3.48 | 5.13 | 4.75 | 0.74 |
| Yield to Worst (EUR Hedged) | 3.62 | N/A | 3.64 | 3.26 | 3.09 |
| Yield to Worst (CHF Hedged) | 1.27 | 1.31 | 1.29 | 0.87 | N/A |
| Modified Duration | 3.77 | 4.60 | 6.93 | 4.19 | 7.26 |
| Market Value | N/A | 2,995,259 | 7,552,796 | 6,046,759 | 467,275 |
| Average Rating | Baa2/Baa3 | A3/Baa1 | A3/Baa1 | A2/A3 | Aa1/Aa2 |
| # Securities | 76 | 4,116 | 8,746 | 6,136 | 1,060 |
Source: Bloomberg as of May 29, 2026
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Disclaimer:
This is a marketing communication. This is not a contractually binding document, or an information document required by law. Please refer to the prospectus of iMGP and to the key information document (“KID”)/key investor information document (“KIID”) before making any final investment decisions. These documents, as well as the summary of investors’ rights, are available in English on the website www.imgp.com and the iMGP offices at 5 Allée Scheffer, L-2520 Luxembourg. The information or data contained herein does not in any way constitute an offer or a recommendation or advice to buy or sell shares in the Fund’s units. The value of the units mentioned may fluctuate and investors may not recover all or part of their initial investment. The information in this e-mail and any attachments may be privileged and confidential and is intended for the exclusive use of the addressee. Any other usage is strictly prohibited. If you have received this e-mail and any attachments in error, please contact us immediately and delete them. More information on www.imgp.com.
