MainStay High Yield Opportunities Fund

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Investment
Subadvisor

 

MacKay Shields LLC is an affiliate of New York Life Investment Management LLC. MacKay Shields has specialized in money management for over 70 years. They offer a broad range of fixed income related strategies and solutions for a wide array of global clients including pension funds, government and financial institutions, family offices, high net worth individuals, endowments and foundations, and retail clients.

Portfolio Managers

  • Dan C. Roberts, PhD
  • Fund's Manager:
    Since Inception

    Industry Experience:
    35 years

  • Michael J. Kimble, CFA
  • Fund's Manager:
    Since Inception

    Industry Experience:
    30 years

  • Taylor Wagenseil
  • Fund's Manager:
    Since Inception

    Industry Experience:
    35 years

  • Louis N. Cohen, CFA
  • Fund's Manager:
    Since Inception

    Industry Experience:
    36 years

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  • High-yield income with growth potential

  • Summary
  • Performance
  • Portfolio
  • Distributions
    & Yields
  • Fees &
    Expenses

Fund Objective: Seeks a maximum current income through investment in a diversified portfolio of
high-yield debt securities. Capital appreciation is a secondary objective.

  • Investment Strategy and Process
    Under normal circumstances, the Fund will invest at least 80% of its assets in high-yield corporate debt securities, including all types of high-yield domestic and foreign corporate debt securities that are rated below investment grade by Moody's or Standard and Poor's, or, if unrated, are considered by the Fund's Subadvisor to be of comparable quality. The Fund's long positions may total up to 140% of net assets and short positions up to 40% of net assets. The long and short positions may vary over time as market opportunities develop.

    The Subavisor seeks to identify issuers whose securities are considered to have a high probability of outperforming the Bank of America Merrill Lynch U.S. High Yield Master II Constrained Index over a market cycle, based on quantitative and qualitative analysis, and may sell short securities it believes are likely to underperform the index. Proceeds from short sales may be used to purchase additional long positions.

    The portfolio management team seeks to generate excess returns by utilizing their investment discipline, trading skills, risk management, and expertise in long/short investing.

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Class A & INV: 4.5% maximum initial sales charge. Class C: 1% CDSC if redeemed within one year. Class I: No initial sales charge or CDSC. Total annual operating expenses are: Class A: 1.48%, INV: 1.44%, C: 2.19%, I: 1.23%.

Performance data quoted represents past performance. Past performance is no guarantee of future results. Due to market volatility, current performance may be less or higher than the figures shown. Investment return and principal value will fluctuate so that upon redemption, shares may be worth more or less than their original cost. Performance figures reflect a contractual fee waiver and/or expense limitation agreement in effect through 2/28/15, without which total returns may have been lower. This agreement shall renew automatically for one-year terms unless written notice is provided prior to the start of the next term or upon approval of the Board.

Style Box
Before You Invest

Short sales involve costs and risk. If a security sold short increases in price, the Fund may have to cover its short position at a higher price than the short sale price, resulting in a loss. Because the Fund’s loss on a short sale arises from increases in the value of the security sold short, such loss is theoretically unlimited. When borrowing a security for delivery to a buyer, the Fund also may be required to pay a premium and other transaction costs, which would increase the cost of the security sold short. By investing the proceeds received from selling securities short, the Fund is employing a form of leverage, which creates special risks. The use of leverage may increase the Fund’s exposure to long equity positions and make any change in the Fund’s NAV greater than it would be without the use of leverage. This could result in increased volatility of returns.

High-yield securities (commonly referred to as "junk bonds") are generally considered speculative because they present a greater risk of loss than higher-quality debt securities and may be subject to greater price volatility. Floating rate loans are generally considered to have speculative characteristics that involve default risk of principal and interest, collateral impairment, borrower industry concentration, and limited liquidity. Issuers of convertible securities may not be as financially strong as those issuing securities with higher credit ratings and may be more vulnerable to changes in the economy.

Foreign securities may be subject to greater risks than U.S. investments, including currency fluctuations, less liquid trading markets, greater price volatility, political and economic instability, less publicly available information, and changes in tax or currency laws or monetary policy. These risks are likely to be greater for emerging markets than for developed markets. The Fund may invest in derivatives, which may increase the volatility of the Fund’s NAV and may result in a loss to the Fund. Funds that invest in bonds are subject to interest-rate risk and can lose principal value when interest rates rise. Bonds are also subject to credit risk, in which the bond issuer may fail to pay interest and principal in a timely manner.

Disclosure

1. POP (Public Offering Price) is the NAV (Net Asset Value) plus a sales charge. All POPs are subject to revision and include the maximum sales charge.

2. Average annual total returns include the change in share price and reinvestment of dividends and capital gain distributions. Performance for Investor Class shares includes the historical performance of Class A shares from inception (12/14/07) through 2/27/08 adjusted to reflect the applicable fees and expenses. Class I shares are generally available only to corporate and institutional investors.

4. No sales charge applies to Class A and Investor Class share investments of $1,000,000 or more ($500,000 for MainStay Floating Rate, High Yield Municipal Bond, New York Tax Free Opportunities, Short Duration High Yield, and Tax Free Bond Funds), but a CDSC of 1% may be imposed on certain redemptions of such shares within one year (18 months for Mainstay Short Duration High Yield Fund) of the date of purchase.

5. Percentages are based on fixed-income securities held in the Fund's investment portfolio and exclude any equity or convertible securities and cash or cash equivalents. Ratings apply to the underlying portfolio of debt securities held by the Fund and are rated by an independent rating agency, such as Standard and Poor's, Moody's, and/or Fitch. If ratings are provided by the rating agencies, but differ, the lower rating will be utilized. If only one rating is provided, the available rating will be utilized. Securities that are unrated by the rating agencies are reflected as such in the breakdown. Unrated securities do not necessarily indicate low quality.

Investment Definitions

The Bank of America Merrill Lynch U.S. High Yield Master II Constrained Index is a market value-weighted index of all domestic and Yankee high-yield bonds, including deferred interest bonds and payment-in-kind securities. Issues included in the index have maturities of one year or more and have a credit rating lower than BBB-Baa3, but are not in default. No single issuer may constitute greater than 2% of the index. Index results assume the reinvestment of all capital gain and dividend distributions. An investment cannot be made directly into an index.

The P/E Ratio (price-to-earnings) denotes the weighted average of all the P/Es of the securities in the Fund's portfolio. The P/B Ratio (price-to-book) is the weighted average of all the P/Bs of the securities in the Fund's portfolio. Return on Equity (ROE) is the weighted average of all the ROEs of the securities in the Fund's portfolio. ROE is calculated by dividing net income by book value. Standard deviation measures how widely dispersed a fund's returns have been over a specified period of time. A high standard deviation indicates that the range is wide, implying greater potential for volatility. Beta is a measure of historical volatility relative to an appropriate index (benchmark) based on its investment objective. A beta greater than 1.00 indicates volatility greater than the benchmark's. Alpha measures a fund's risk-adjusted performance and is expressed as an annualized percentage. R-Squared measures the percentage of a fund's movements that result from movements in the index. The Sharpe Ratio shown is calculated for the past 36-month period by dividing annualized excess returns by annualized standard deviation. The Annual Turnover Rate is as of the most recent annual shareholder report. Upside/Downside Market Capture measures a manager's performance in up/down markets relative to the Fund's benchmark.

Video Disclosure

The opinions expressed are those of the portfolio managers as of the date of this report and are subject to change. There is no guarantee that any forecast made will come to pass. This material does not constitute investment advice and is not intended as an endorsement of any specific investment.

Past performance is no guarantee of future results which will vary.