The most risky bonds are out-performing investment grade
This is just a guess, but as I recall the Energy sector had a lot of junk bonded companies in it and I am wondering if, due to those companies’ still-positive fundamentals (and valuation), that is playing a role in junk bond out-performance (Junk is, however, bouncing within a downtrend in nominal terms) as the Energy sector attracts funding.
Here is the HYG (junk)/LQD (investment grade) ratio ticking a new high.
Here is the corporate bond market distress index (NY Fed). In this crazy world junk is not as risky as investment grade, which is coming under much distress. Something’s going to have to give. Right?
For “best of breed” top down analysis of all major markets, subscribe to NFTRH Premium, which includes an in-depth weekly market report, detailed market updates and NFTRH+ dynamic updates and chart/trade setup ideas. Subscribe by Credit Card or PayPal using a link on the right sidebar (if using a mobile device you may need to scroll down) or see all options and more info. Keep up to date with actionable public content at NFTRH.com by using the email form on the right sidebar. Follow via Twitter@NFTRHgt.