Hedge funds are cautiously optimistic about the US high-yield bond markets. While spreads are attractive, the uncertainty in Europe, fickle investor flows and a reluctance among dealers to provide liquidity could be a source of downside risk in the near term, according to credit specialists.
High-yield bonds and loans are currently trading at unusually large multiples to the risk-free rate after a sharp sell-off in the summer caused yields to spike. The average spread between high-yield bonds and
The week on Risk.net, March 10-16 2018Receive this by email