Welcome to Dividend.com. Please help us personalize your experience.

Select the one that best describes you

Thank you!

Check your email and confirm your subscription to complete your personalized experience.

Thank you for your submission, we hope you enjoy your experience


Pricing
Go Premium Now
Login
Best Dividend Stocks
Ex-Dividend Dates
High Yield Stocks
Strategies
Tools
Articles
Premium
Advisors
Guaranteed Income

High Yield Coming to an End

News

The High Times in High Yield Might Be Ending

Aaron Levitt Dec 28, 2017


High yield or junk bonds have been riding high since the start of 2017. The debts issued by firms with less than stellar credit have seen a surge in interest as the combination of low rates – thanks to the Fed – and a growing economy has made them quite attractive to investors. In fact, junk has been one of the best performing asset classes all year.

The problem is that the high times in high yield might finally be cracking.

Investors who loaded up on high yield bonds for both larger coupons and capital appreciation might get a rude awakening in the new year.

Junks Big Time Climb

On the surface, it’s easy to see how junk has done well. Despite raising rates four times or so this cycle, when you are starting in the basement, there’s plenty of room before you hit the top. Interest rates remain at historic lows. That’s still causing investors to search for income in some non-traditional sources. With junk bonds paying around 5 to 8%, that’s a lot of yield for income-starved investors.

To read the Full Story, Go Premium or Log in

Popular Articles