High-Yield Bonds: Truce

The high yield corporate bond market has performed phenomenally well over the past few months. After having broken sharply lower for months, high-yield bonds bottomed in February and have been rallying furiously higher ever since. What’s perhaps most notable is that despite this rally, corporate credit quality has deteriorated further and bankruptcies have surged over this same time period. Perhaps this high-yield rally is signaling that the worst will soon be over for the asset class. Or then again, maybe it has been nothing more than a truce for the embattled category in an ongoing war that remains long from over.

Please click on the link to read more of my article on Seeking Alpha.

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