high-yield bond fund

(redirected from Junk Bond Fund)

High-Yield Bond Fund

A mutual fund that invests predominantly or exclusively in junk bonds. Because junk bonds have low credit ratings, they offer a comparatively high return. High-yield bond funds generally have portfolios containing at least two-thirds junk bonds. They provide a way for investors to take advantage of the return offered by a junk bond while also avoiding the risk of investing in a single bond at a high risk of default. See also: Investment grade.

high-yield bond fund

An investment company that attempts to produce unusually high income for its shareholders by maintaining a corporate bond portfolio that contains at minimum two thirds lower-rated bonds (Baa by Moody's; BBB by S&P).
References in periodicals archive ?
Its trailing 12-month yield of about 4.5% is roughly 80 basis points below the largest junk bond fund's corresponding yield.
Just short eight months ago, activist investor Carl Icahn referred to the junk bond fund market as a "keg of dynamite." At that time, the junk bond market was in a temporary swoon.
With recent publicity around some high yield bond funds suffering large investor outflows, and, for example, Third Avenue Management looking to block investors from withdrawing money from a nearly $1 billion junk bond fund that it is trying to liquidate, A.M.
Under the amended tax law provision, an investor who invests in a junk bond fund for more than a year and up to three years is eligible for a low 5 percent tax rate for any gains from investment up to 100 million won.
in Kokomo also has aimed to diversify its, portfolio with a junk bond fund, says Louis Schmitt, senior vice president and chief financial officer.
ANGL holds 201 bonds and while it is a junk bond fund, fallen angels typically have less representation the speculative CCC rating group than do bonds born as junk.
These bonds have been so depressed for two years that yields are comparatively high: The average junk bond fund now pays more than 10%.
Fearing the Fed might raise rates faster than expected, investors pulled billions of dollars out of junk bond funds in July.
In May, junk bond funds took in $2.61 billion, and then the withdrawals began.
Riskier high-yield junk bond funds, meanwhile, attracted $1 billion, according to the Bank of America Merrill Lynch report, which also cited data from fund-tracking firm EPFR Global.
The thinking here is similar to junk bond funds, where the pitch was that individual risks of default, while real, could be mitigated by portfolio analysis when you brought enough different types of high-yield bonds together.