Junk bonds have enjoyed a rally since the start of the year but investors are facing a dilemma.
As the graphic above shows, volatility in U.S. stocks has re-entered what could be called normal territory after soaring higher during the financial crisis. The blue band is plus or minus one standard deviation around the 1990 to 2007 avverage.
It was Goldman Sachs who famously predicted oil prices to reach $200 a barrel last year, but there are a school of bullish investors who forecast a substantial rally in gold.
There's no shortage of bad news in the financial world at the moment.
But one top hedge fund manager believes that equities could soon be heading for a very sharp rally.