Rotten Tomato Stocks
No Result
View All Result
  • News
    Pending Home Sales Declined in April to Two-Year Low

    Pending Home Sales Declined in April to Two-Year Low

    Glencore Pays up to $1.5B to Resolve Corruption Claims

    Glencore Pays up to $1.5B to Resolve Corruption Claims

    Slumping Technology Stocks Pull Wall Street Lower

    Slumping Technology Stocks Pull Wall Street Lower

    Asian Shares Mostly Lower as Inflation Worries Cloud Outlook

    Asian Shares Mostly Lower as Inflation Worries Cloud Outlook

  • NYSE
    Gap stock drops as Old Navy’s struggles sink sales and outlook

    Gap stock drops as Old Navy’s struggles sink sales and outlook

    Consolidated Edison Inc. stock falls Thursday, underperforms market

    Consolidated Edison Inc. stock falls Thursday, underperforms market

    Molina Healthcare (NYSE:MOH) Stock Price Down 3.5% Following Analyst Downgrade

    Molina Healthcare (NYSE:MOH) Stock Price Down 3.5% Following Analyst Downgrade

    Snowflake stock slides after earnings as company says macro issues are impacting some customer activity

    Snowflake stock slides after earnings as company says macro issues are impacting some customer activity

  • NASDAQ
    Workday stock drops after earnings miss, slightly higher outlook

    Workday stock drops after earnings miss, slightly higher outlook

    Gilead Sciences Inc. stock falls Thursday, underperforms market

    Gilead Sciences Inc. stock falls Thursday, underperforms market

    NVIDIA (NASDAQ:NVDA) Shares Gap Down After Analyst Downgrade

    NVIDIA (NASDAQ:NVDA) Shares Gap Down After Analyst Downgrade

    Nutanix stock dives more than 30% after earnings include poor forecast

    Nutanix stock dives more than 30% after earnings include poor forecast

  • OTC
    China Eastern Airlines 3Q Loss Widens on Low Travel Demand

    China Eastern Airlines 3Q Loss Widens on Low Travel Demand

    Corus Entertainment 4Q Profit Falls

    Corus Entertainment 4Q Profit Falls

    Nintendo Co. Ltd. ADR falls Monday, still outperforms market

    Nintendo Co. Ltd. ADR falls Monday, still outperforms market

    Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

    Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

  • TSX
    US Seeks to Fine Air Canada $25.5 Million Over Slow Refunds

    US Seeks to Fine Air Canada $25.5 Million Over Slow Refunds

    S&P/TSX composite falls on drop in materials sector, loonie tops 81 cents US

    S&P/TSX composite falls on drop in materials sector, loonie tops 81 cents US

    Bitcoin Is Falling: Should You Buy the Dip?

    Bitcoin Is Falling: Should You Buy the Dip?

    CN Rail Stock Is So Undervalued That it’s Absurd

    CN Rail Stock Is So Undervalued That it’s Absurd

  • News
    Pending Home Sales Declined in April to Two-Year Low

    Pending Home Sales Declined in April to Two-Year Low

    Glencore Pays up to $1.5B to Resolve Corruption Claims

    Glencore Pays up to $1.5B to Resolve Corruption Claims

    Slumping Technology Stocks Pull Wall Street Lower

    Slumping Technology Stocks Pull Wall Street Lower

    Asian Shares Mostly Lower as Inflation Worries Cloud Outlook

    Asian Shares Mostly Lower as Inflation Worries Cloud Outlook

  • NYSE
    Gap stock drops as Old Navy’s struggles sink sales and outlook

    Gap stock drops as Old Navy’s struggles sink sales and outlook

    Consolidated Edison Inc. stock falls Thursday, underperforms market

    Consolidated Edison Inc. stock falls Thursday, underperforms market

    Molina Healthcare (NYSE:MOH) Stock Price Down 3.5% Following Analyst Downgrade

    Molina Healthcare (NYSE:MOH) Stock Price Down 3.5% Following Analyst Downgrade

    Snowflake stock slides after earnings as company says macro issues are impacting some customer activity

    Snowflake stock slides after earnings as company says macro issues are impacting some customer activity

  • NASDAQ
    Workday stock drops after earnings miss, slightly higher outlook

    Workday stock drops after earnings miss, slightly higher outlook

    Gilead Sciences Inc. stock falls Thursday, underperforms market

    Gilead Sciences Inc. stock falls Thursday, underperforms market

    NVIDIA (NASDAQ:NVDA) Shares Gap Down After Analyst Downgrade

    NVIDIA (NASDAQ:NVDA) Shares Gap Down After Analyst Downgrade

    Nutanix stock dives more than 30% after earnings include poor forecast

    Nutanix stock dives more than 30% after earnings include poor forecast

  • OTC
    China Eastern Airlines 3Q Loss Widens on Low Travel Demand

    China Eastern Airlines 3Q Loss Widens on Low Travel Demand

    Corus Entertainment 4Q Profit Falls

    Corus Entertainment 4Q Profit Falls

    Nintendo Co. Ltd. ADR falls Monday, still outperforms market

    Nintendo Co. Ltd. ADR falls Monday, still outperforms market

    Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

    Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

  • TSX
    US Seeks to Fine Air Canada $25.5 Million Over Slow Refunds

    US Seeks to Fine Air Canada $25.5 Million Over Slow Refunds

    S&P/TSX composite falls on drop in materials sector, loonie tops 81 cents US

    S&P/TSX composite falls on drop in materials sector, loonie tops 81 cents US

    Bitcoin Is Falling: Should You Buy the Dip?

    Bitcoin Is Falling: Should You Buy the Dip?

    CN Rail Stock Is So Undervalued That it’s Absurd

    CN Rail Stock Is So Undervalued That it’s Absurd

No Result
View All Result
Rotten Tomato Stocks
No Result
View All Result

Junk Bond Yields Are Falling. Should Investors Get Picky?

Editorial Staff by Editorial Staff
July 13, 2021
0
Junk Bond Yields Are Falling. Should Investors Get Picky?

In scrambling for more yield, investors are, not surprisingly, embracing high-yield corporate debt. However, inflation is taking a bite out of junk bond returns, indicating investors could get selective in this corner of the bond market.

One way of accomplishing that goal is with the Invesco Fundamental High Yield® Corporate Bond ETF (PHB). The $844.4 million PHB follows the RAFI Bonds US High Yield 1-10 Index. As is the case with any index, methodology matters.

PHB’s underlying benchmark has avenues for setting itself apart that could be useful to investors at a time when inflation is weighing on junk bonds.

“A rally in corporate debt rated below investment grade has pushed yields to record lows around 4.57%, according to ICE Bank of America data through Thursday, while consumer prices rose 5% in May compared with a year earlier. That marks the first time on record junk-bond yields have dropped below the rate of inflation, according to Bespoke Investment Group,” reports Julia Ambra-Verlaine for the Wall Street Journal.

Points in Favor of PHB

PHB has a 30-day SEC yield of 2.23%, well below the yield mentioned above. However, that’s not strike against the Invesco fund.

While now may seem like the time to embrace the junkiest junk bonds – those with CCC ratings or lower – markets can shift on a dime, punishing speculative fare along the way. For its part, PHB leans into quality by only holding debt rated B or above. Seventy-eight percent of the fund’s 193 holdings are rated BBB or BB.

Compounding PHB’s quality purview is that bonds in the fund are weighted by dividends, generated cash flow, and book value of assets. Those qualifiers can serve to mitigate default risk among PHB components.

“Traditional bond indices, which are weighted by the amount of debt outstanding, may not always be optimal for passive solutions. In traditional indices, the most indebted issuers receive the largest index weights. Weighting according to the debt appetite of bond issuers can leave investors overexposed to firms with poor credit quality, without compensation for the added risk they take on,” according to Research Affiliates, PHB’s index provider.

While PHB isn’t the highest yielding junk bond ETF out there, it is credibly levered to a recovering U.S. economy because consumer discretionary and energy debt accounts for about a third of the fund’s weight. Ninety-six percent of the fund’s holdings have maturities of one to five or five to 10 years.

Related Posts

Workday stock drops after earnings miss, slightly higher outlook
NASDAQ

Workday stock drops after earnings miss, slightly higher outlook

May 26, 2022
Gilead Sciences Inc. stock falls Thursday, underperforms market
NASDAQ

Gilead Sciences Inc. stock falls Thursday, underperforms market

May 26, 2022
NVIDIA (NASDAQ:NVDA) Shares Gap Down After Analyst Downgrade
NASDAQ

NVIDIA (NASDAQ:NVDA) Shares Gap Down After Analyst Downgrade

May 26, 2022
Nutanix stock dives more than 30% after earnings include poor forecast
NASDAQ

Nutanix stock dives more than 30% after earnings include poor forecast

May 26, 2022
Load More
Next Post
Does Alphabet (NASDAQ:GOOG.L) Have A Healthy Balance Sheet?

Does Alphabet (NASDAQ:GOOG.L) Have A Healthy Balance Sheet?

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

I agree to the Terms & Conditions and Privacy Policy.

POPULAR NEWS

CNH Industrial (NYSE:CNHI) Use Of Debt Could Be Considered Risky

CNH Industrial (NYSE:CNHI) Use Of Debt Could Be Considered Risky

April 14, 2021
10 Warning Signs That Should Tell You “This Stock is in Trouble”

10 Warning Signs That Should Tell You “This Stock is in Trouble”

November 11, 2019
Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

September 14, 2021
CN Rail Stock Is So Undervalued That it’s Absurd

CN Rail Stock Is So Undervalued That it’s Absurd

May 2, 2021
Nektar, worst performing stock in S&P 500, gets booted from the index

Nektar, worst performing stock in S&P 500, gets booted from the index

November 12, 2019

EDITOR'S PICK

Multiple Challenges Will Keep iQiyi Stock Subdued

Multiple Challenges Will Keep iQiyi Stock Subdued

November 19, 2019
Aphria Gets Smoked On Surprisingly Awful Earnings

Aphria Gets Smoked On Surprisingly Awful Earnings

April 15, 2021
Nestle recalls DiGiorno pizza nationwide following consumer complaint

Nestle recalls DiGiorno pizza nationwide following consumer complaint

September 27, 2021
Funko (NASDAQ:FNKO) Could Easily Take On More Debt

Funko (NASDAQ:FNKO) Could Easily Take On More Debt

December 27, 2021

Stay Updated

Get breaking news delivered straight into your inbox

Nothing in this publication should be considered as personalized financial advice. We are not licensed under securities laws to address your particular financial situation. No communication by our employees to you should be deemed as personalized financial advice. Please consult a licensed financial advisor before making any investment decision. This is a paid advertisement and is neither an offer nor recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this report or email is not provided to any individual with a view toward their individual circumstances. Rotten Tomato stocks is a wholly-owned subsidiary of Grainne Capital Limited.
While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our newsletter is not trustworthy unless verified by their own independent research. Also, because events and circumstances frequently do not occur as expected, there will likely be differences between the any predictions and actual results. Always consult a licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment.

Rotten Tomato Stocks cover the companies and markets that are declining, failing or headed for disaster. We help investors spot the down tends and recognize when something smells rotten.

RECENT POSTS

Pending Home Sales Declined in April to Two-Year Low

Gap stock drops as Old Navy’s struggles sink sales and outlook

Consolidated Edison Inc. stock falls Thursday, underperforms market

POPULAR POSTS

Molina Healthcare (NYSE:MOH) Stock Price Down 3.5% Following Analyst Downgrade

Workday stock drops after earnings miss, slightly higher outlook

Gilead Sciences Inc. stock falls Thursday, underperforms market

© Copyright 2021 RottenTomatoStocks. All Rights Reserved 

Disclaimer | Privacy Policy

No Result
View All Result
  • HOME
  • NEWS
  • NYSE
  • NASDAQ
  • OTC
  • TSX

© 2021 RottenTomatoStocks.com

error: Content is protected !!
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.