Short Term Trading Member Forum

[techcharter]

High Yield Fund

I recall seeing on the Federal Reserve website decades of records on AAA and BBB bond yields. If you plot the difference between their yields and treasuries, you will find appetite for risk when the difference is minimal, and flight to quality as the difference increases. It's been a few year since I charted this data. I'll add it to my list of things to do since I'm very curious how things have changed.

The chart at the link you tells a lot. The NAV for the fund since inception has dropped a whopping 75% over 10 years. It consolidated after the DotCom bubble burst despite record rate easing and hedge fund appetite for high risk debt. The fund never challenged the original NAV near $16. Now with a general credit crunch, debt will get a lower price when it needs to be sold for the fund to remain liquid.