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    A tactical opportunity in UK credit

    A tactical opportunity in UK credit

    19 June 2025 Fixed income

    “The UK credit market is skewed by its largest investors who have a big appetite for higher-rated credit. This has squeezed spreads for A and AA-rated credit and left BBB-rated credit relatively unloved with a higher spread dispersion compared to euro and US dollar-denominated BBB-rated credit.”

    Damien Hill
    Senior Portfolio Manager

    Both tactical and structural opportunities currently exist in UK credit versus Euro and US dollar denominated credit.

    These exist due to the following four factors:

    • Relatively insulated from the global trade war
    • Greater spread dispersion
    • Greater international diversification
    • Higher yields offer greater protection against any capital loss

    Each of these points is illustrated with a chart in the article in the link below.

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