Western Asset High Income Opportunity Fund boasts a 10.52% yield but faces risks. Learn why HIO's recent NAV drop makes it a ...

What happened next? Treasury yields plunged while junk yields soared. The chart below plots the junk-bond spread over the ...

That means corporate bond prices fall, so corporate bond yields rise. High-yield (junk) bonds have the highest default risk, and default expectations have more influence on their prices.

Highlights,Bonds with speculative credit ratings of BB (S&P) or Ba (Moody’s) or lower.,Offer higher yields to compensate for increased credit risk.,Rated by Standard & Poor’s and Moody’s Investor ...

But Fridson calls that “grasping at straws” and notes that the high-yield bond market “sports a risk premium grossly inadequate for its current risk.” US junk spreads widened earlier this ...