High-yield bond

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High-yield bond

High-Yield Bond

A bond with a low rating. Bonds rated less than Baa3 by Moody's or BBB- by S&P or Fitch are considered high-yield bonds. They have higher yields because they have a higher risk of default on the part of the issuer. High-yield bonds are considered sufficiently high-risk that the law does not allow banks to invest in them. They are also called low-grade bonds, and, informally, junk bonds.

high-yield bond

See junk bond.

High-yield bond.

High-yield bonds are bonds whose ratings from independent rating services are below investment grade.

As a result, to attract investors, issuers of high-yield bonds must pay a higher rate of interest than the rates that issuers of higher-rated bonds with the same maturity are paying. The higher rate translates to more income, which is the higher yield.

High-yield bonds may also be described, somewhat more graphically, as junk bonds.

References in periodicals archive ?
We are looking forward to Peter's taking over the reins as Portfolio Manager and assuming leadership of our High Yield Bond Fund team," said Pax World President and CEO Joe Keefe.
Detailed information about Market Vectors US Treasury-Hedged High Yield Bond Index and the full range of Market Vectors Indices, including methodology details and comprehensive data are available on www.
The deal also involved the receipt of consents to the refinancing transaction under the company s senior credit facilities and WAF s outstanding high yield bonds and the simultaneous tender offer to holders of WAF s and the issuer-subsidiary of WIND's parent s high yield bonds that were being refinanced.
When combined with other income asset classes in a diversified portfolio, an allocation to high yield bonds may temper principal fluctuation and potentially enhance returns over the long term.
Including all fees that have been paid for financings over the past 4 months alone, we estimate that the Company will have disbursed approximately US$16 million in fees if the Proposed High Yield Bond proceeds.
Our aim, one we have realized in roughly similar market environments, is to exit near the top of intermediate term high yield bond market prices and re-enter this market at what we perceive to be intermediate price trend lows.
In addition, since a large amount of new high yield bond issuance is being used to retire secured loans, there has been a significant increase in secured note issuance to date in 2009.
The Fund has also received a 5-star and 4-star Overall Morningstar Rating[TM] for institutional and individual investor class shares, respectively, for the period ended June 30, 2008 out of 476 high yield bond funds based on risk-adjusted returns.
Jerry Wagner, President and Founder of Flexible Plan Investments, explained: "A strategically timed portfolio of high yield bond mutual funds can provide an excellent source of risk-adjusted returns for long-term growth of investment portfolios.
To accomplish this, the High Yield Bond Fund portfolio management team invests in the high-quality segment of the high yield market.
Often the individual investor's only alternative is a high yield bond fund often with a high commission and management fees.
BOSTON -- Evergreen Investments announced today that Gary Pzegeo, CFA, has been named Managing Director and interim head of Evergreen's High Yield Bond team, effective immediately.