High-Yield Anxiety
Your Junk-Bond Worries Are All Wrong
It's not flight or rising yields that matter but signals about sluggish long-term returns.
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There are reasons to be skeptical about high-yield bonds, but not for the ones investors have been worried about lately.
For starters, there’s little indication that investors are fleeing risky bonds for good. Yes, two of the biggest U.S. junk-bond ETFs have experienced outflows this month. Investors pulled $1 billion from the SPDR Bloomberg Barclays High Yield Bond ETF through Friday and $600 million from the iShares iBoxx High Yield Corporate Bond ETF.