They sport yields of more than 7%, which explains their popularity with investors trying to boost income.
Analysts say high-yield bonds should perform well if a credit event in Europe is avoided, defaults stay low and the U.S. economy continues to grow.
“That’s not to say there won’t be volatility. But if you’re a buy-and-hold investor, you should be happy in five years,” said Andrew Feltus, portfolio manager at Pioneer Investments, in the WSJ article.
iShares iBoxx High Yield Fund
Full disclosure: Tom Lydon’s clients own HYG.