Are high-yield corporate bonds a risk?

We continue to see risks with high-yield corporate bonds, but their high yields can't be ignored. The average yield-to-worst of the Bloomberg US Corporate High-Yield Bond Index has been hovering in the 7.5% to 8% area for most of this year, and the relatively high income payments they offer can help serve as a buffer in case prices do fall. 3

What is the S&P US high yield corporate bond index?

See More The S&P U.S. High Yield Corporate Bond Index is designed to track the performance of U.S. dollar-denominated, high-yield corporate bonds issued by companies whose country of risk use official G-10 currencies, excluding those countries that are members of the United Nations Eastern European Group (EEG).

Are high-yield bonds a good investment?

The average yield-to-worst of the Bloomberg US Corporate High-Yield Bond Index has been hovering in the 7.5% to 8% area for most of this year, and the relatively high income payments they offer can help serve as a buffer in case prices do fall. 3 There are two key concerns with high-yield bonds today: