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News

Junk-bond market gets first big test of year from coronavirus
January 28, 2020

Coronavirus is not only infecting people, but also the high yield markets. Portfolio Manager John McClain, CFA is quoted in this MarketWatch article.

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Energy Companies Refinancing Debt at a Premium
January 27, 2020

In this Financial Times article on energy companies refinancing their debt at a premium, Portfolio Manager John McClain, CFA says that investors are now paying the price for being too greedy.

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Downgrades Are Rattling Jittery Investors in the Junk Market
January 21, 2020

William Zox, CFA, fixed income CIO, told Bloomberg that in this part of the credit cycle with junk bonds rallying to new highs, the market shoots first and asks questions later when a company falters.

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Sprint Swaps Flash Market Doubts Over Fate of T Mobile Tie Up
January 14, 2020

John McClain, CFA discusses potential risks associated with investing in Sprint debt in Olivia Raimonde’s Bloomberg article.

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Energy Sector and Access to Capital Markets
January 12, 2020

Portfolio manager John McClain, CFA, discusses the energy sector and access to capital markets in the Financial Times.

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What’s next for the stock market? Here’s what you need to know
January 12, 2020

Fixed Income CIO Bill Zox was quoted on investor reaction to recent tensions with Iran in the Boston Globe.

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Diamond Hill's Corporate Credit Fund Is Small Enough To Win Big
December 23, 2019

The Diamond Hill Corporate Credit fund (DSIAX) was featured in Seeking Alpha where Josh Ortner discusses the fund’s performance and our managers’ diligence in selective purchasing high yield issuance.

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Bill Zox Discusses Key Questions For 2020
January 2, 2020

William Zox, CFA discusses his 2020 market outlook, specifically his expectation that fixed income markets will be driven by fundamentals, his view on the corporate bond landscape and how geopolitics will affect markets with Oliver Renick on TD Ameritrade Network.

Watch Bill’s full interview

Bloomberg Businessweek TV/Radio Simulcast Full Show
December 26, 2019

William Zox discusses his fixed income outlook for 2020 and how fed activity may continue to drive volatility with Romaine Bostick and Carol Massar Bloomberg TV and Bloomberg Radio.

Watch Bill’s full interview at the 36:30 minute mark

Major indexes in the green at the start of the trading day
December 23, 2019

John McClain discusses valuations being stretched and setting up the 2020 battle between interest rates and equity valuations. He recommends being defensive postured going into next year, owning BBBs over BBs, and look for volatility in 2020 on Yahoo! Finance with Alexis Christoforous and Brian Sozzi.

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Twitter plans first foray into junk bond market
December 4, 2019

John McClain, CFA discusses the appeal of Twitter’s junk bond debut for high yield investors in Joe Rennison and Hannah Murphy’s Financial Times article, “Twitter plans first foray into junk bond market.”

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A Giant House of Cards': How the Era of Easy Money May Come to Haunt a Slew of Debt-Ridden Companies
December 3, 2019

William Zox, CFA discusses the junk bond market and investors’ search for yield in Larry Light’s Fortune article, “A Giant House of Cards’: How the Era of Easy Money May Come to Haunt a Slew of Debt-Ridden Companies.”

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Twitter's Rare Pitch to Junk Market: Profitable Tech Issuer
December 3, 2019

John McClain, CFA discusses Twitter’s junk bond market debut and trading up in credit quality in Claire Boston and Molly Smith’s Bloomberg article, “Twitter’s Rare Pitch to Junk Market: Profitable Tech Issuer.”

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John McClain: U.S. Futures Lower After S&P, Dow Hit New Records
November 14, 2019

John McClain, CFA discusses economic data’s effect on equity and fixed income markets, trading up in quality as a means of portfolio insurance, and the Fed’s reaction to policy with Oliver Renick on TD Ameritrade Network.

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Walgreens Mulls Historic LBO Just as Debt Markets Start to Wilt
November 5, 2019

William Zox, CFA discusses Walgreens’ potential leveraged buyout and his skepticism about price and margins in Sally Bakewell’s Bloomberg article, “Walgreens Mulls Historic LBO Just as Debt Markets Start to Wilt.”

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Freebies are the key hook in new streaming wars
October 30, 2019

Cathy Yao discusses ways in which companies can retain customers through bundling in the ‘streaming wars’ in Mae Anderson’s Associated Press article “Freebies are the key hook in new streaming wars.”

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Markets Are Betting That Good Things Come in Threes—Especially Rate Cuts
October 29, 2019

William Zox, CFA discusses the bond market and the possibility of another Fed rate cut in Erik Sherman’s Fortune article “Markets Are Betting That Good Things Come in Threes—Especially Rate Cuts.”

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AT&T Steps Into Streaming Wars With HBO Max
October 29, 2019

Cathy Yao discusses the importance of financials associated with AT&T’s new streaming service in Drew Fitzgerald and Joe Flint’s The Wall Street Journal article, “AT&T Steps Into Streaming Wars With HBO Max.”

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S&P 500 hits new high as Trump expects to sign China trade deal at APEC meeting
October 28, 2019

John McClain, CFA discusses the record breaking market high, the Fed’s potential decision to cut rates, how quantitative easing benefits rich valuations, the importance of trading up in the capital structure, and opportunities in fixed income with Alexis Christoforous, Brian Sozzi, and Jared Blikre on Yahoo! Finance.

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Investors Starve US Shale Drillers of Capital
October 28, 2019

John McClain, CFA discusses how high yield investors are less focused on energy companies in Gregory Meyer and Joe Rennison’s Financial Times article, “Investors starve US shale drillers of capital.”

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WeWork could burn through $10 billion rescue finance in 10 months without major cost cuts, experts say
October 25, 2019

John McClain, CFA discusses investor sentiment around WeWork bonds following SoftBank’s rescue package in Joy Wiltermuth’s MarketWatch article, “WeWork bonds fall on SoftBank’s roughly $10 billion rescue package”.

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Bill Zox Talks Opportunities in High Yield Bonds
October 21, 2019

William Zox, CFA discusses the possibility of an October Fed rate cut, the uninverted yield curve and bond volatility, and opportunities in the financials and energy sectors within high yield bonds with Oliver Renick on TD Ameritrade Network.

Watch Bill’s full interview

Feeling Risky? WeWork’s 15% Bonds Would Be for Bravest of Brave
October 15, 2019

John McClain, CFA discusses the risk associated with WeWork bond investing in Claire Boston’s Bloomberg article, “Feeling Risky? WeWork’s 15% Bonds Would Be for Bravest of Brave.”

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Stocks lower on report that China wants more trade talks
October 14, 2019

John McClain, CFA discusses further escalation of a Trade War, the possibility of a fourth quarter market correction, and the diluted impact of quantitative easing and its impact on risk assets with Brian Sozzi, Scott Gamm and Matt Maley on Yahoo! Finance.

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Short sellers pile into WeWork debt
October 3, 2019

John McClain, CFA discusses investment opportunities in WeWork debt in Eric Platt and Joe Rennison’s Financial Times article, “Short sellers pile into WeWork debt.”

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WeWork's Cash Clock is Running Down Quickly
September 26, 2019

John McClain, CFA discusses WeWork debt in Claire Boston’s Bloomberg article, “WeWork’s Cash Clock is Running Down Quickly.”

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Trade fight weighs on investors
September 23, 2019

John McClain, CFA discusses the possibility of a Trade Truce, low market volatility, and a possible market correction with Brian Sozzi, Alexis Christoforous and Jared Blikre on Yahoo! Finance.

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Zox: Likelihood of “trade truce” most important issue we’re watching
September 23, 2019

William Zox, CFA discusses the Trade Wars vs. the Trade Truce and its impact on credit markets, sticking with the late cycle playbook, and the risk of recession with Brian Sullivan on CNBC Worldwide Exchange.

Watch Bill’s full interview

Cathy Yao Discusses the 5G Winners and Losers
September 17, 2019

Cathy Yao, CFA discusses the state of 5G, its implications, and challenges to 5G deployment with Nicole Petallides on TD Ameritrade Network.

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WeWork bond prices tumble after it shelves IPO
September 17, 2019

John McClain, CFA discusses WeWork’s borrowing model and lack of investor support in Eric Platt and Joe Rennison’s Financial Times article, “WeWork bond prices tumble after it shelves IPO.”

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Uber Boosts Junk Bond Sale in First Debt Raise Since IPO
September 12, 2019

John McClain, CFA discusses Uber junk bonds in Davide Scigliuzzo and Molly Smith’s Bloomberg article, “Uber Boosts Junk Bond Sale in First Debt Raise Since IPO.”

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Bill Zox on the Dow Industrials
September 10, 2019

William Zox, CFA discusses holding non-bank financials in the Diamond Hill High Yield fund, trends within the fixed income market, and the impact of a trade deal on bonds with Oliver Renick on TD Ameritrade Network.

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Tariffs Starting to Hit Macro And Micro Data (Radio)
September 9, 2019

John McClain, CFA discusses the fixed income markets, how investors should stick with the late cycle playbook and focus on not losing money in today’s market environment, the impact of tariffs on macro and micro data, and opportunities in corporate credit with Doug Krizner and Rishaad Salamat on Bloomberg Radio.

Listen to John’s full interview

Corporate bond issuance sets global record
September 6, 2019

John McClain, CFA discusses investors’ search for yield and the high yield bond market in Joe Rennison’s Financial Times article, “Corporate bond issuance sets global record.”

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Popeyes Junk Bonds a Sell-Out, Just Like Its Chicken Sandwiches
September 6, 2019

John McClain, CFA discusses investors’ hunt for yield in Sally Bakewell and Gowri Gurumurthy’s Bloomberg article, “Popeyes Junk Bonds a Sell-Out, Just Like Its Chicken Sandwiches.”

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U.S. Junk Bonds With Negative Yields? Yes, Kind of
September 6, 2019

William Zox, CFA discusses how investors are navigating the corporate bond market in Sam Goldfarb’s The Wall Street Journal article, “U.S. Junk Bonds With Negative Yields? Yes, Kind of.”

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'Volatility is back' amid trade war uncertainty
September 3, 2019

John McClain discusses the Fed, uncertainty in the global markets, the Trade War, the potential for recession, and corporate earnings with Alexis Christoforous, Brian Sozzi and Jared Blikre on Yahoo! Finance.

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Zox: focus on preserving capital
August 30, 2019

William Zox, CFA discusses the bond market, how investors should look to preserve capital and stick to the late cycle playbook with Brian Sullivan on CNBC Worldwide Exchange.

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2019 continues to face volatility amid trade war tensions
August 26, 2019

John McClain, CFA discusses how 2019 could continue to face volatility amid trade war tensions with Brian Sozzi on Yahoo! Finance.

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Meet Me in the Middle
August 23, 2019

William Zox, CFA encourages investors to focus on not losing money, if stocks and Treasuries do meet somewhere in the middle in WealthManagement.com’s 2019 Mid-Year Outlook, “Meet Me in the Middle.”

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Recession probability in the next 12 to 18 months is elevated: analyst
August 15, 2019

William Zox, CFA discusses the Fed’s impact on the yield curve inversion and the elevated probability of a U.S. recession with Julie Hyman, Adam Shapiro, Tendayi Kapfidze and Ramsey Smith on Yahoo! Finance.

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Why these market experts say a recession may not happen, but it’s hard to bring momentum into the market and be positive on stocks right now
August 15, 2019

William Zox, CFA discusses the fixed income markets, the divergence between government bond markets and risk assets, and the risk of recession with Dominic Chu on CNBC.

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Credit Traders Rush to Hedge as Trade War Whips Bond Market
August 5, 2019

John McClain recommends investors look to high quality businesses and defensive bonds as the Trade War rattles the markets in Caleb Mutua, Katrina Lewis and Claire Boston’s Bloomberg article, “Credit Traders Rush to Hedge as Trade War Whips Bond Market.”

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John McClain on What the U.S./China Trade War Means For The Fed
August 5, 2019

John McClain, CFA discusses volatility in the markets and the implications of the Trade War on the Fed with Oliver Renick on TD Ameritrade Network.

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Here Are the Fed’s 4 Options for a Rate Cut—and How the Market Will React to Each
July 29, 2019

William Zox, CFA discusses this week’s Fed decision and its impact on markets with Larry Light in Fortune, “Here Are the Fed’s Four Options for a Rate Cut-and How the Market Will React to Each.”

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Junk bond issuers snap up chance to stretch out borrowing
July 25, 2019

John McClain, CFA discusses the dangers high yield investors face when companies issue longer-term debt and lower borrowing costs in Joe Rennison’s Financial Times article, “Junk bond issuers snap up chance to stretch out borrowing.”

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All eyes on the Fed and the rate cut decision
July 19, 2019

John McClain, CFA discusses the Fed’s potential rate cut decision and its impact on the markets, and the Trade War with Dan Roberts, Kristin Meyers and Heidi Chung on Yahoo Finance.

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As of 12/31/19 there were 3 gold rated, 7 silver rated, 15 bronze rated, 21 neutral rated, 2 negative rated and 195 not rated funds in the U.S. High Yield Bond category. Morningstar Analyst ratings relative to the Morningstar Category are based on the cheapest share class for each fund as defined by Morningstar. The cheapest share class does not necessarily equate to the highest rated share class.

The Morningstar Analyst Rating™ is not a credit or risk rating. It is a subjective evaluation performed by Morningstar’s manager research group, which consists of various Morningstar, Inc. subsidiaries (“Manager Research Group”). In the United States, that subsidiary is Morningstar Research Services LLC, which is registered with and governed by the U.S. Securities and Exchange Commission. The Manager Research Group evaluates funds based on five key pillars, which are process, performance, people, parent, and price. The Manager Research Group uses this five pillar evaluation to determine how they believe funds are likely to perform relative to a benchmark, or in the case of exchange-traded funds and index mutual funds, a relevant peer group, over the long term on a risk-adjusted basis. They consider quantitative and qualitative factors in their research, and the weight of each pillar may vary. 

The Analyst Rating scale is Gold, Silver, Bronze, Neutral, and Negative. A Morningstar Analyst Rating of Gold, Silver, or Bronze reflects the Manager Research Group’s conviction in a fund’s prospects for outperformance. Analyst Ratings ultimately reflect the Manager Research Group’s overall assessment, are overseen by an Analyst Rating Committee, and are continuously monitored and reevaluated at least every 14 months. For more detailed information about Morningstar’s Analyst Rating, including its methodology, please go to global.morningstar.com/managerdisclosures/.

The Morningstar Analyst Rating (i) should not be used as the sole basis in evaluating a fund, (ii) involves unknown risks and uncertainties which may cause Analyst expectations not to occur or to differ significantly from what they expected, and (iii) should not be considered an offer or solicitation to buy or sell the fund.

The Overall Morningstar Rating™ is based on 616 high yield bond funds as of 12/31/19. The Fund’s Class I rating was 5 stars among 616, 5 stars among 539, and 4 stars among 339 high yield bond funds for the 3-, 5-, and 10-year periods ended 12/31/19, respectively.

The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

The Morningstar Broad Fee Level data point compares the fund's net expense ratio to the net expense ratio of all the other funds within its Morningstar Category.

© 2020 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

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