Scott Ellis

Corporate Securities Specialist
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Scott Ellis

Mr. Ellis joined Penn Mutual Asset Management in September 2016 as a Corporate Securities Specialist. Mr. Ellis is responsible for research and analysis, trading, and portfolio management of investment grade and high yield corporate credit securities.

Prior to joining Penn Mutual Asset Management, Mr. Ellis was an Investment Manager and Credit Analyst for Aberdeen Asset Management from 2008 to 2016. While at Aberdeen Mr. Ellis covered U.S. investment grade as well as U.S. and global high yield with a specialization in the chemicals, paper, packaging, and forest products industries. Mr. Ellis was also responsible for coverage of European high yield credits while working in Aberdeen’s London office, and helped develop and train the European high yield research team.

Mr. Ellis graduated with distinction from the University of Michigan in 2008 with a Bachelor of Arts degree with concentrations in Business and Sociology.

Scott has been a Chartered Financial Analyst (CFA) Charterholder since 2012.

Stories by Scott Ellis

Drilling A Bit Deeper into High Yield Energy

By Scott Ellis | November 2, 2017

With the energy markets seemingly rebalanced and oil prices hovering near $55 per barrel, we have decided to take a closer look at the Oil Field Services sector. This subsector is the weakest link in the energy supply chain as these companies largely rely on exploration and drilling capital expenditures. It was the most distressed energy subsector in 2016 and has been the last to recover. Still, enough has transpired to suggest a potential inflection point in fundamentals in 2018 or 2019, with many of the survivors effectively extending their own runways via opportunistic refinancings. Despite the spread compression in 2017, as seen in this week’s chart, this subsector of High Yield Energy still has higher credit spreads than the overall High Yield Energy sector and therefore is worth drilling into further (pun intended).

I’m not an Economist, But…

By Scott Ellis | September 14, 2017

I am certainly not an economist, but when a Barron’s article early in September highlighted an obscure but potentially troubling economic data point, I had to find out more. The Federal Reserve Bank of Philadelphia produces monthly coincident indexes for each of the 50 U.S. states. These monthly indexes describe recent trends and are further combined into a diffusion index value. More specifically, these indexes focus on four state-level indicators to summarize current economic conditions. The variables in this coincident index include nonfarm payroll employment, average hours worked in manufacturing by production workers, the unemployment rate, and wage and salary disbursements deflated by the consumer price index (U.S. city average) – per the Philadelphia Fed’s website.

Credit Markets: Throwing Caution to the Wind

By Scott Ellis | July 20, 2017

Many investors are struggling to find attractive investment opportunities in today’s environment. One can choose from waiting on the sidelines in cash, investing in government bonds (10-year U.S. Treasuries 2.3%), investment grade bonds (+105 basis points (bps) in the U.S.), high yield bonds (+439 bps in the U.S.) or equities (S&P 500 Index is up ~10% year-to-date) and other more esoteric and less liquid investments such as private equity, venture capital and real estate. Central bankers around the world have been using their balance sheets to buy the most liquid and least risky investments, and as a result, bringing the yields down significantly. Because of this, investors have been moving further down the risk spectrum in hopes of attaining the same returns they once were able to achieve. The central bankers’ actions have left other investors to fight for the remaining investable assets.

Animal Spirits Reignite as M&A Activity Surges

By Scott Ellis | May 25, 2017

It has been a very strong run for the markets since the great recession in 2008/2009. The S&P 500 Index has returned over 200%1 since 12/31/08, and the U.S. High Yield Market is not far behind at over 180% (as measured by the Bank of America Merrill Lynch U.S. High Yield Index). Following such strong runs over the past 8+ years, one has to wonder how much longer this can be sustained.

Are Leveraged Loans Becoming a Crowded Trade?

By Scott Ellis | March 30, 2017

Corporations have a variety of different options when it comes to raising outside capital. In the most basic form, they can issue equity or debt. When corporations elect to raise debt, they can issue it on a secured or unsecured basis and with fixed or floating rates. It is up to the management teams to choose the best option for the company at that time and to preserve its options for the future.

U.S. High Yield: Is the Juice Worth the Squeeze?

By Scott Ellis | January 26, 2017

The U.S. High Yield market (USHY), as represented by the JP Morgan Domestic High Yield Index, quietly returned almost 19% in 2016, outpacing stocks in the S&P 500 Index, which are up approximately 12%, and the Dow Jones Industrial Average, up approximately 16.5%. There are many constantly changing variables that factor into market returns. However, I wonder if even without being able to identify and correctly forecast every variable, was there a way to predict the odds of an outsized return for the USHY market at the start of 2016?

Reading the Tea Leaves

By Scott Ellis | December 1, 2016

As total return investors, we are always trying to identify undervalued investments that have a catalyst to appreciate to what we believe is fair value. In the current market environment, credit spreads have performed very well across most risk markets this year, and attractive opportunities have become more difficult to identify.