Greg Zappin

Managing Director, Portfolio Manager
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Greg Zappin

Mr. Zappin serves as Managing Director & Portfolio Manager and is responsible for the management of the high yield fixed income investing.

Prior to joining The Penn Mutual Life Insurance Company in February 2012 where he gained experience in high yield fixed income portfolio management,

Mr. Zappin worked for five years as a Senior Credit Research Analyst at Logan Circle Partners where he covered investment grade and high yield credits in the energy, healthcare, transportation and industrial sectors. Prior to Logan Circle Partners, Mr. Zappin worked in a similar capacity for Delaware Investments for five years.

Mr. Zappin graduated in 1988 from the University of Massachusetts in Amherst with a Bachelor degree in Business Administration. He also earned a Masters of Business Administration degree from Columbia Business School in 1994.

Greg has been a Chartered Financial Analyst (CFA) Charterholder since 1997.

Stories by Greg Zappin

Fundamentals Rule the Day

By Greg Zappin | October 12, 2017

The daily record highs in the equity markets and the relentless grind tighter in the credit markets elicit both feelings of marvel and trepidation. As you can see in the chart above, revenue and EBITDA are growing at strong levels across the companies in the S&P 500. The uneasy feeling in the fixed income market comes from the disparity between valuations at or near their post crisis tights versus the constant barrage of negative news outside of Wall Street – North Korean war talk, devastating hurricanes and fires, mass shooting in Las Vegas, and dysfunction in Washington. For most high-yield investors, waiting for the big pullback by sitting in cash is not an option, as the active manager gets compensated to take risk and outperform an index. It’s easy to get distracted in this type of market. When I sift through all the noise, I have found the best way to construct a credit portfolio is to rely on business fundamentals as a guiding light.

Rating Changes Signal Balanced Credit Trends

By Greg Zappin | August 17, 2017

Despite criticism for acting too slow or being backward looking, rating agencies and the credit ratings they assign are still relevant in the corporate bond market today. Ratings trends can be a useful, albeit imperfect, tool to access over credit quality in the market and sometimes offer a source of alpha if future ratings direction can be correctly anticipated. Non-financial credit ratings are based on fairly transparent criteria, particularly the leverage and profitability metrics. It’s the qualitative judgments about competitive position, industry dynamics and financial policy that are grey areas. While new issue ratings have proven to be an accurate gauge of default risk over time, the timing of subsequent ratings actions is a big market gripe. Ratings are meant to look through cycles, which can create big gaps between an issuer’s ratings and bond pricing and current fundamentals.

The Business Cycle Extends

By Greg Zappin | June 22, 2017

The current business cycle has become one of the longest on record, and based on our intermediate-term outlook, it could end up rivaling the 1991-2001 period in terms of its duration. Interestingly, because of the muted nature of the recovery and broader deleveraging that has occurred, the excesses that typically build as growth accelerates have not emerged, and therefore the current credit cycle is less extended.

Oil Beta Percolates Under the Market’s Surface

By Greg Zappin | April 27, 2017

Oil prices were the big story in the credit markets from the fall of 2014 through the fall of 2016 as the 40% decline in benchmark WTI helped drive a… Read More

High Yield Retailers Send Distress Signal

By Greg Zappin | March 2, 2017

The high yield market continues to be a strong relative and absolute performer, up about 2.5% year-to-date (YTD) following a greater than 18% total return in 2016. Virtually all sectors have generated positive excess returns this year, except one: retail. The J.P. Morgan U.S. High Yield Index has tightened 28 basis points (bps), while the retail sub-index has widened 100 bps YTD. Often it pays to be a contrarian and add to sectors that are out of favor and have materially underperformed. However, the situation in retail is neither cyclical nor supply driven.

Will the Natural Gas Price Recovery be Sustained?

By Greg Zappin | October 27, 2016

Oil, copper, steel, gold and other industrial and precious metals tend to garner most of the attention in the credit markets when talking about the commodity complex. Rightly so, as they serve as proxies for global gross domestic product (GDP) growth, flight to quality/risk sentiment and Chinese demand.

Leveraged Loans Becoming Top of Mind

By Greg Zappin | August 25, 2016

Fixed income total and excess returns continue to impress, and 2016 is on pace to collectively be one of the stronger years for spread product in the post-crisis period. An asset class that has performed well, but has lagged on a relative basis, is leveraged loans.

Goldilocks Visits the Oil Patch

By Greg Zappin | June 2, 2016

Not too hot, not too cold. That’s been the state of the domestic economy for the better part of seven years. Every time we think the party is about to end, the central banks have managed to maintain order and reestablish equilibrium.

Strong Like Bull

By Greg Zappin | May 26, 2016

The high yield market has staged a remarkable comeback from its January and early February swoon and is now tracking for its best year since 2012. The question is: what is the durability of the rally and what could derail it?

Oil and High Yield Correlations Stay Strong

By Greg Zappin | March 31, 2016

Because of the high correlation with oil prices, it is increasingly difficult to have a call on the attractiveness of the high yield market without a call on oil.