A Question of Junk
When I discuss the high-yield bond market with other bond traders, the discussion tends to center around spreads. But when I talk to investors, the conversation is about the absolute yield. Which is the right way to look at the junk bond market? Are bonds traders myopic to the risks of rising rates? Or are investors naïve about how bonds really work? In my fund, I'm supposed to be trying for absolute return and I trade high-yield actively, so this question is something I've thought about a lot. I can't just accept the relative return implied by spreads.
So what to do?...893 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
There’s no substitute for a trading floor to get great ideas, so Jim Cramer created a better one at Real Money and blogs there exclusively. We then added legendary hedge fund manager, Doug Kass, with his exclusive Daily Diary and best investing ideas. Staffed with more than 4 dozen investing pros, money managers, journalists and analysts, Real Money Pro gives you a flood of opinions, analysis and actionable trading advice found nowhere else, and allows you to interact directly with each expert.
Already a Subscriber? Please login.
