Managed High Yield Plus Fund Inc. – Fund Commentary and Portfolio Statistics

Managed High Yield Plus Fund Inc. (NYSE:HYF) (the “Fund”) is a closed-end management investment company seeking high income, and secondarily, capital appreciation, primarily through investments in lower- rated, income-producing debt and related equity securities.

Fund Commentary for the third quarter 2013 from UBS Global Asset Management (Americas) Inc. (“UBS Global AM”), the Fund’s investment manager

Market Review

While the global fixed income market experienced periods of elevated volatility during the third quarter, it ultimately generated a positive return. In the US, Treasury yields generally moved higher in July and August due to expectations that the Federal Reserve Board (the "Fed") would decide to begin the tapering of its $85 billion monthly asset purchases at its meeting on September 18. After peaking in early September, Treasury yields fell sharply as the Fed chose to not taper, saying that it: "…decided to await more evidence that progress will be sustained before adjusting the pace of its purchases." Also driving yields lower in late September were increasing signs that lawmakers in Washington DC would not come up with a budget accord in time to avert a partial government shutdown on October 1. Looking at the third quarter as a whole, the US yield curve steepened, as longer-term yields increased more than their shorter-term counterparts. The overall US bond market, as measured by the Barclays US Aggregate Index, returned 0.57% during the quarter.

The spread sectors (non-US Treasury fixed income securities) generated positive returns during the third quarter. High yield corporate bonds were a relatively strong performer during the quarter, as the BofA Merrill Lynch US High Yield Cash Pay Constrained Index1 (the “Index”) returned 2.28%. From a ratings perspective, higher-quality rated high yield debt broadly underperformed lower-quality bonds, with the BB- and B-rated segments lagging the CCC and below-rated segment.

Performance Review

For the third quarter of 2013, the Fund posted a net asset value total return of 3.47% and a market price return of 2.31%. On a net asset value basis, the Fund outperformed the Index, its benchmark, which, as previously stated, returned 2.28% for the quarter.

Within spread management, security selection was the main contributor to performance during the quarter, particularly our holdings in the energy and technology sectors. However, this was modestly offset by our holdings in the building materials sector. Sector allocation, overall, was a slight detractor from performance with financial institutions as well as metals and mining detracting from performance during the quarter. On the other hand, overweights in the energy, cable television and technology sectors added to performance.

A number of changes were made to the portfolio during the quarter. We pared the Fund's overweight to securities rated BBB and above. From a sector perspective, we increased our overweight in the energy sector and pared our allocation to the gaming sector. Elsewhere, we reduced the Fund's overweight in telecommunications and pared its underweight to healthcare.

Outlook

We remain broadly constructive on high yield as an asset class. We expect the near-term outlook for the default rate to remain low, and our analyst team has a credit fundamental outlook for US high yield issuers that is slightly more favorable than it was three months ago. The major risk to this view is that technical factors, potentially driven by possible outflows from the asset class and a challenging environment for trading liquidity, could overwhelm in the near-term and lead to volatility and weakness in high yield markets. We also expect the high yield market to continue to exhibit increased correlation with the US Treasury market, which could lead to further periods of volatility as speculation about the timing of Fed tapering continues over the coming months.

During the third quarter, we sought to maintain a broadly neutral stance in portfolios from a beta (or market risk) perspective versus the benchmark, with active risk primarily driven by the bottom-up views of our credit analyst team.

We anticipate that investment opportunities will arise through bottom-up issue selection and the avoidance of credit deterioration. From an industry perspective, the portfolio's overweights include energy, cable television and technology, driven by issue selection. The portfolio has an underweight to healthcare, primarily driven by valuations. Underweights to metals and mining and the steel sectors are based on valuations and fundamentals, particularly when we consider the high leverage and excess capacity in these sectors.

Please note that the Fund’s quarterly portfolio statistics, which in the past were disclosed as part of the Fund’s dividend declaration releases, will now be reflected in the quarterly commentaries, as seen below.

Any performance information reflects the deduction of the Fund’s fees and expenses, as indicated in its shareholder reports, such as investment advisory and administration fees, custody fees, exchange listed fees, etc. It does not reflect any transaction charges that a shareholder may incur when (s)he buys or sells shares (e.g., a shareholder’s brokerage commissions).

Disclaimers Regarding Fund Commentary - The Fund Commentary is intended to assist shareholders in understanding how the Fund performed during the period noted. The views and opinions were current as of the date of this press release. They are not guarantees of performance or investment results and should not be taken as investment advice. Investment decisions reflect a variety of factors, and the Fund and UBS Global AM reserve the right to change views about individual securities, sectors and markets at any time. As a result, the views expressed should not be relied upon as a forecast of the Fund’s future investment intent.

Past performance does not predict future performance. The return and value of an investment will fluctuate so that an investor's shares, when sold, may be worth more or less than their original cost. Any Fund net asset value ("NAV") returns cited in a Fund Commentary assume, for illustration only, that dividends and other distributions, if any, were reinvested at the NAV on the payable dates. Any Fund market price returns cited in a Fund Commentary assume that all dividends and other distributions, if any, were reinvested at prices obtained under the Fund's Dividend Reinvestment Plan. Returns for periods of less than one year have not been annualized. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund dividends and other distributions, if any, or on the sale of Fund shares.

Investing in the Fund entails specific risks, such as interest rate risk, the greater credit risks inherent in investing primarily in lower-rated, higher-yielding bonds as well as the increased risk of using leverage (that is, borrowing money to invest in additional portfolio securities). Further detailed information regarding the Fund, including a discussion of principal objectives, principal investment strategies and principal risks, may be found in the fund overview located at http://www.ubs.com/closedendfundsinfo. You may also request copies of the fund overview by calling the Closed-End Funds Desk at 888-793 8637.

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