However, there are some immediate risks. For instance, some are wary of a downturn if Iran’s embargoed oil hits the global markets after negotiations over its nuclear program.
Moreover, some energy companies are on thin ice. Quicksilver Resources and American Eagle Energy defaulted earlier this year. KKR-controlled Samson Resources recently warned that it may seek Chapter 11 bankruptcy protection to help restructure debt. Standard & Poor’s also pointed out other weak energy companies like Sabine Oil & Gas, Energy XXI and Permian Holdings. [Default Fears Abate, Investors Return to Junk Bond ETFs]
SPDR Barclays High Yield Bond ETF
For more information on the speculative-grade debt market, visit our junk bonds category.
Max Chen contributed to this article.