Euro high yield bond
Target equity-like returns with less volatility
The opportunity
High-yield bonds carry lower credit ratings than investment-grade or sovereign bonds but offer higher yields to compensate for the additional risk. They tend to, therefore, deliver equity-like returns over the longer term – and typically with less volatility than the equity market due to their income component, which can act as a ballast during market downturns.
Hence, these characteristics, coupled with relatively low-interest rate sensitivity thanks to generally shorter maturities and less correlation with other types of bonds as well as commodities, may make high-yield bonds in our view an interesting option for a well-diversified investment portfolio.
Source: BNP Paribas Asset Management, as of March 2026.
Strategy highlights
Portfolio diversification
Like equities, high-yield bonds can offer attractive long-term return potential but are typically less volatile. They can help to diversify portfolios as they tend to exhibit low correlations to other fixed income instruments, such as treasuries and corporate bonds, as well as generally lower duration.
Experienced team
Supported by our global credit platform, our high-yield investment team generates high-conviction ideas using a combination of top-down macroeconomic allocation views and bottom-up in-depth fundamental analysis of bond issuers. This allows them to identify compelling opportunities across the broad and diverse high-yield universe that can help provide stability and diversification, and boost potential in investors’ portfolios.
Disciplined risk management
To mitigate risk, the team’s robust and repeatable investment process concentrates on high-quality bond issuers and diversification in its portfolio construction. ESG¹ criteria is also integrated at every stage of the investment process, which can, for example, help to identify more resilient bonds and/or issuers, promote resilience in changing markets, and may enhance risk-adjusted returns.
Team and expertise
The euro high yield bond strategy is managed by Olivier Monnoyeur and support by fellow Euro High Yield team members Stef Abelli and Gilles Caraguel, all based in London. Serving as both portfolio manager and analyst, each team member contributes a strong background in credit research and is responsible for a given number of sectors within the European high-yield universe. Together, they have more than 20 years’ average industry experience² and manage around EUR 40 billion of global credit assets covering the entire securities and rating spectrum, from fixed income loans to securitised debt.³
The team is part of BNP Paribas Asset Management’s Global Fixed Income investment group, which helps to ensure a global approach that considers all investment possibilities. To this end, they frequently collaborate with our other fixed income teams including, but not limited to, High Yield and Investment Grade Corporates, Emerging Markets, Structured Securities, Global Rates, and Money Markets. Notably, they benefit from access to our extensive Global Fixed Income Credit Research platform,⁴ as well as our dedicated Sustainability Centre, Quantitative Research Group and Global Macro Research team.
Investment risks
Investments are subject to market fluctuations and other risks inherent to investing in securities. The value of investments and the income they generate may rise or fall and it is possible that investors may not recover their initial investment.
The strategy may be exposed to specific risks, including Collateral Management Risk, Counterparty Risk, Credit Risk, Derivatives Risk, SFT Risks, Extra-Financial Criteria Investment Risk, High Yield Bond Risk, and Liquidity Risk.
For a complete description and definition of the strategy’s generic and specific risks, please refer to the Prospectus and KID.
[1] ESG: Environmental, Social and Governance. ESG assessments are based on BNP Paribas Asset Management’s proprietary methodology, which integrates all three aspects of E, S and G.
[2,3,4] BNP Paribas Asset Management as of 31/03/26
Important information
Marketing communication. For professional investors only.
Past performance or achievement is not indicative of current or future performance. Performance is calculated net of fees unless otherwise stated.
Any views expressed here are those of the author as of the date of publication, based on available information, and subject to change without notice. This material does not constitute investment advice.
Investments are subject to market fluctuations and the risks inherent in investments in securities. The value of investments and the income they generate may go down as well as up and it is possible that investors will not recover their initial investment. There is no guarantee that the performance objective will be achieved.
Investing in emerging markets, or specialised or restricted sectors is likely to be subject to a higher-than-average volatility due to a high degree of concentration, greater uncertainty because less information is available, there is less liquidity or due to greater sensitivity to changes in market conditions (social, political and economic conditions).
Environmental, social and governance (ESG) investment risk: The lack of common or harmonised definitions and labels integrating ESG and sustainability criteria at EU level may result in different approaches by managers when setting ESG objectives. This also means that it may be difficult to compare strategies integrating ESG and sustainability criteria to the extent that the selection and weightings applied to select investments may be based on metrics that may share the same name but have different underlying meanings. In evaluating a security based on the ESG and sustainability criteria, the Investment Manager may also use data sources provided by external ESG research providers. Given the evolving nature of ESG, these data sources may for the time being be incomplete, inaccurate or unavailable. Applying responsible business conduct standards in the investment process may lead to the exclusion of securities of certain issuers. Consequently, (the Sub-Fund’s) performance may at times be better or worse than the performance of relatable funds that do not apply such standards.
This is not an exhaustive list of risks. For a complete description and definition of risks, please consult a client relationship manager or the global BNP Paribas Asset Management website: www.bnpparibas-am.com.