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DDJ Capital Management marks third anniversary of DDJ Opportunistic High Yield Fund

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DDJ Capital Management, an independent manager of high yield and special situation investments on behalf of institutional investors, has marked the three-year anniversary of its DDJ Opportunistic High Yield Fund.

The open-end mutual fund (DDJIX, DDJCX, and DDJRX) received a 5-star overall rating from Morningstar as of 31 July 2018.
For the three-year period that ended 31 July 2018, the Fund outperformed (on both a gross and net basis) the ICE BofA Merrill Lynch US High Yield Non-Financial Index, a broad unmanaged high yield index that excludes financial issuers. In addition, according to Morningstar, the Fund’s Institutional share class (DDJIX) ranked fifth out of 588 US open end funds within its High Yield Bond category in performance for that period. Based on data provided by Morningstar, that ranking places the Fund among the top 2 per cent of its category peers in that three-year stretch.
The investment objective of the DDJ Opportunistic High Yield Fund is to achieve overall total return consisting of a high level of current income together with long-term capital appreciation. To accomplish this objective, the Fund seeks a yield advantage over the ICE BofA Merrill Lynch US High Yield Non-Financial Index. The Fund invests at least 80 per cent of its net asset value in high yield debt securities and maintains a concentrated portfolio that historically has comprised 50-70 issuers.
Launched on 16 July, 2015, the Fund is co-managed by David J Breazzano (pictured), DDJ’s President and Chief Investment Officer who co-founded DDJ Capital in 1996, together with Benjamin J Santonelli and John W Sherman, each of whom have over ten years of experience working with Breazzano at DDJ Capital.
“The three-year performance of the Fund relative to its peer set affirms DDJ’s investment philosophy, which is based on a fundamental, bottom-up approach designed to exploit inefficiencies in the high yield credit markets and identify unrecognised value,” says Breazzano. “While high yield bonds have traditionally provided a hedge for investors as interest rates rise, not all high yield securities are created equally. This area of the market, particularly lower-rated issuers that may carry a higher risk profile, requires careful analysis of each individual investment opportunity. At this point in the credit cycle, with a potential inflection point possibly approaching, individual and institutional investors seeking exposure to the high yield asset class need to be especially diligent in their manager and fund selection process.”
The DDJ Opportunistic High Yield Fund, with both retail and institutional share classes, pursues DDJ’s flagship opportunistic high yield investment strategy, which seeks to generate strong risk-adjusted returns by adhering to a value-oriented, bottom-up, fundamental approach to investing with a focus on the lower tier of the high yield universe.

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