What is the High Yield Bond Spread? And Why Do Investors Watch It?
Episode description
Recently you’ve probably heard a lot of financial news media referring to the widening of spreads. Specifically, the High Yield Spread has widened above 1000 basis points. But what does it mean when the high yield spread increases? Get an overview on spreads widening or tightening. Plus, see how differently rated parts of the bond fixed income market see their spreads widen or narrow compared to US Treasury Bonds.
What is the High Yield Bond Spread?
What does it mean when bond spreads widen?
Comparing High Yield Bond yields to yields on US Treasury Bonds
Bond spreads as indicator on stock market
Explaining difference in credit rating on bonds
What rating is considered junk bond status
What did high yield spreads do in 2008 crisis?
What is the Option Adjusted Spread or OAS spread?
Callable bond features
Comparing yield spreads in investment grade bonds, CCC bonds, BBB bonds
Default rates as risk factors
Probability of bond defaults
Mentioned in this Episode:
Current High Yield Option Adjusted Bond Spread https://fred.stlouisfed.org/series/BAMLH0A0HYM2
Podcast explaining bonds for investors and corporations http://brokenpiechart.libsyn.com/explaining-bonds-for-investors-and-corporations
Current CCC High Yield Bond Spread https://fred.stlouisfed.org/series/BAMLH0A3HYC
Current BBB Bond Yield Spread https://fred.stlouisfed.org/series/BAMLC0A4CBBB
Derek Moore’s book Broken Pie Chart https://www.amazon.com/Broken-Pie-Chart-Investment-Portfolio/dp/1787435547/ref=sr_1_1?keywords=broken+pie+chart&qid=1558722226&s=books&sr=1-1-catcorr
Contact Derek www.razorwealth.com