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Weekly Market Summary
Sep 15 to Sep 19, 2025
Extra Credit*
- The 60/40 portfolio has experienced less pain than the stock market during nearly every market crash of the past 150 years. The Great Depression was four times more painful for the stock market than for a 60/40 portfolio. The Lost Decade (2000 to 2009) was more than seven times as painful for the stock market than a 60/40 portfolio. And the COVID-driven stock market crash of March 2020 barely even registered for the 60/40 portfolio (which clocked only an 8.5% decline). In aggregate, a 60/40 portfolio experienced 45% less pain than an all-equities portfolio during the stock market crashes of the past 150 years.
- According to recent Barclays research, despite falling total returns and shifting relative value, it is anticipated that steadily declining base rates should have a muted effect on bank loans, as technicals should remain strong. Loan fundamentals should continue to improve, with interest coverage ratios (ICRs) continuing to inflect higher and defaults continuing their downward trajectory.
- Passive investing can be effective, especially in liquid, higher-quality, and homogeneous parts of the bond market. Yet, limitations of index coverage and real-world distortions make it hard to index major parts of the global bond market. One cause of the bond market’s inefficiency is the fact that most bonds are owned by a relatively small number of large investors, which can result in a limited buyers and sellers willing to transact. In turn, this small number of bond investors means relatively little trading outside of the largest, most liquid bonds.
As of 9/17/25.
Previous reports
*Source: Morningstar®, Bloomberg, Credit Suisse. OAS is Options Adjusted Spread. 4-year discount margin is used for spread for bank loans. Yield quoted is yield-to-worst or equivalent calculation. YTD Low / High for yields are based on end of week and not intraday movements. Indexes and sub-indexes: Investment-grade corporates represented by Bloomberg US Corporate Bond Index. High-yield bonds represented by Bloomberg US Corporate High Yield Index. Bank loans represented by Credit Suisse Leverage Loan Index. The red and green arrows depicted under Yields, Option Adjusted Spreads, and Prices indicate a higher or lower value from the previous week.
Past performance does not guarantee future results. Index performance is not indicative of fund performance. Indexes are unmanaged and it is not possible to invest directly in an index.
Any discussion of individual companies is not intended as recommendation to buy, hold or sell securities issued by those companies. Aristotle Fund holdings can be found on the fund pages linked above.
Investors should consider a fund’s investment goal, risks, charges, and expenses carefully before investing. The prospectus and/or the applicable summary prospectus contain this and other information about the Fund and are available from AristotleFunds.com. The prospectus and/or summary prospectus should be read carefully before investing.
Investing involves risk. Principal loss is possible.
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