“Longer term, high yield appears well positioned to outperform most other fixed income assets. With investors more concerned about interest rate risk than credit risk, high yield spreads offer more-than-adequate compensation for likely credit losses and the ability to absorb at least a portion of any further rise in interest rates,” said ING Investments in a note posted by Barron’s.
High yield bond issuance is about $275 billion this year, but October issuance is likely to fall well short of the $47.6 billion seen last month.
PowerShares Fundamental High Yield Corporate Bond Portfolio
ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of HYG and JNK.