Data Dependent — Understanding the Fed's Strategy and What's To Come

Bloomberg US Corporate High Yield Index measures the performance of publicly issued non-investment grade USD fixed-rate, taxable and corporate bonds. The index is unmanaged, includes net reinvested dividends, does not reflect fees or expenses (which would lower the return) and is not available for direct investment. Index data source: Bloomberg Index Services Limited. See diamond-hill.com/disclosures for a full copy of the disclaimer.

S&P 500 Index measures the performance of 500 large companies in the US.

Moody’s Bond Ratings are intended to characterize the risk of holding a bond. These ratings, or risk assessments, in part determine the interest that an issuer must pay to attract purchasers to the bonds. The ratings are expressed as a series of letters and digits. Investment Grade is a bond quality rating of AAA, AA, A or BBB.

As of 30 September 2022, Diamond Hill owned debt in Ford Motor Co., General Motors Co. and General Motors Financial Co. As of 30 November 2022, Diamond Hill owned equity shares of General Motors Co.

Risk disclosure: In general, when interest rates rise, fixed income values fall. Mortgage- and asset-backed securities are influenced by factors affecting the housing market and the assets underlying such securities. The securities may decline in value, face valuation difficulties, and become more volatile and/or illiquid. They are also subject to prepayment risk, which occurs when mortgage holders refinance or repay loans sooner than expected, creating an early return of principal to loan holders.

The views expressed are those of Diamond Hill as of December 2022 and are subject to change without notice. These opinions are not intended to be a forecast of future events, a guarantee of future results or investment advice. Investing involves risk, including the possible loss of principal. Past performance is not a guarantee of future results.