Western Asset High Yield Defined Opportunity Fund (NYSE: HYI) is a closed-end management investment company that seeks to provide a high level of current income. Launched in 2007, the fund trades on the New York Stock Exchange and offers investors exposure to a diversified portfolio of below-investment-grade corporate debt securities. Its “defined opportunity” structure allows the fund to implement an active strategy designed to capitalize on market dislocations and yield opportunities across various credit sectors.
The fund’s investment approach centers on high-yield corporate bonds, bank loans and other fixed-income instruments issued by issuers around the globe. While U.S. high-yield issuers comprise a significant portion of the portfolio, the fund also allocates to European, Latin American and emerging-market credits when relative value presents attractive risk-adjusted returns. The portfolio may employ leverage to enhance yield, typically through bank-borrowed lines of credit, and seeks to maintain broad industry diversification to mitigate idiosyncratic risk.
Western Asset High Yield Defined Opportunity Fund is managed by Western Asset Management Company, a global fixed-income specialist and subsidiary of Franklin Templeton. The fund’s high-yield team utilizes fundamental credit research, rigorous risk controls and proprietary analytics to construct and monitor the portfolio. Investment decisions are guided by in-depth issuer analysis, sector outlooks and macroeconomic factors, with the goal of preserving capital while delivering consistent income.
Targeting income-focused investors, the fund pays monthly distributions and employs a defined monthly distribution rate policy. This structure can appeal to individual and institutional investors seeking a steady income stream from a professionally managed high-yield strategy. By blending active credit selection with disciplined risk management, Western Asset High Yield Defined Opportunity Fund aims to deliver attractive current income potential over the long term.
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