Comments on: High-yield chart of the day http://blogs.reuters.com/felix-salmon/2009/07/29/untitled-13/ A slice of lime in the soda Sat, 18 May 2013 19:38:33 +0000 hourly 1 http://wordpress.org/?v=3.4.2 By: SeanDC http://blogs.reuters.com/felix-salmon/2009/07/29/untitled-13/comment-page-1/#comment-4769 SeanDC Wed, 29 Jul 2009 20:34:32 +0000 http://blogs.reuters.com/felix-salmon/2009/07/29/untitled-13/#comment-4769 High yield bond issuance for the first half of 2009 was $59 bn. Annualized, that is a bit higher than the average annual issuance of the past five years. Not stunning, of course, but I would not characterize it as 'closed.' The leveraged loan is another story. High yield bond issuance for the first half of 2009 was $59 bn. Annualized, that is a bit higher than the average annual issuance of the past five years. Not stunning, of course, but I would not characterize it as ‘closed.’ The leveraged loan is another story.

]]> By: Alex Dalmady http://blogs.reuters.com/felix-salmon/2009/07/29/untitled-13/comment-page-1/#comment-4768 Alex Dalmady Wed, 29 Jul 2009 19:58:01 +0000 http://blogs.reuters.com/felix-salmon/2009/07/29/untitled-13/#comment-4768 Why shouldn't there be demand for high-yield bonds?. It's all a matter of promised return vs. perceived risk. Those who bet that perceived risk was way too high have been rewarded handily as that contraction of spreads in your graphs reflecta an equally impressive rally in bond prices. And let's not forget that all along the way these bonds were accruing interest also. Is the risk/reward relationship as enticing at this point? No. But there's still room to run. I'm not buying much here, but I'm not selling either! Why shouldn’t there be demand for high-yield bonds?. It’s all a matter of promised return vs. perceived risk.

Those who bet that perceived risk was way too high have been rewarded handily as that contraction of spreads in your graphs reflecta an equally impressive rally in bond prices.

And let’s not forget that all along the way these bonds were accruing interest also.

Is the risk/reward relationship as enticing at this point? No. But there’s still room to run. I’m not buying much here, but I’m not selling either!

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