Kimble goes on to note that “At the same time junk was doing so poorly, the decline took both JNK & HYG down to levels not seen since 2012 and momentum is the most oversold in the past 5 years.”
Interestingly, oil’s decline has not chased investors from junk bond ETFs. Since the start of the fourth quarter, HYG and JNK have added $1.77 billion and $884 million in new assets, respectively. However, the two ETFs have endured modest outflows since the start of this month. [What ETF Assets are Cheap and Too Rich]
Chart Courtesy: Kimble Charting Solutions
Tom Lydon’s clients own shares of HYG and JNK.