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Don’t high yield / junk bonds have a higher rate of default?

April 26, 2017bonds Default don’t high JUNK rate yield

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10 Posted

Don’t high yield / junk bonds have a higher rate of default?

1 Answer

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10 Posted

Yes, high yield bonds have a historical default rate of 4-5%. However High Yield Trader does not advocate investing in individual bonds but rather recommends bond funds where investors benefit from the skills of professional bond portfolio managers that buy bond insurance and may hold anywhere from 100-400 bonds in their portfolios.