April was a busy month for CHIG in both primary and secondary markets. The primary market saw another record set for issuance that came mainly in dollars and euros but some in sterling.

We took some 20-year Senior risk from National Grid and Thames Water along with some T2 Subordinated Insurer issues from Phoenix and the Pension Insurance Corp. Tesco regained its IG status last year and came to market with a 10-year bond, which we also took. All these bonds have performed well in the secondary market, Phoenix and Tesco in particular. The strongest performer of recent sterling issuance is the VW 4Q’s 25, which we bought when it came at the beginning of the month, which has tightened from 435 basis points over Gilts at issue to around 255 now.

The secondary market provided plenty of opportunity as spreads rallied. We continue to try and source names that fit the quality profile of the CHIG fund. We added risk in Barclays, HSBC, M&G and BAE Systems to mention a few. We switched out of some more AAA floater exposure as well as some weaker credits to fund these trades.

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