High-yield bond manager David Rosenberg says we’re in a rare situation where investors can earn sharemarket-like returns from buying corporate debt.
Credit, or corporate debt investors, aren’t rewarded if they make a good investment, but they’reRosenberg, however, says this is a rare moment when he feels optimistic. High yield or sub-investment grade debt is paying double-digit returns and that means it is far more compelling to lend to a company rather than own its shares.
While these yields are high, some investors cautiously point out that the premium for owning high-yield bonds is modest relative to historic averages. The reason, he says, is that the high-yield bond market is actually in relatively good health, mainly as a side effect of the pandemic. The third trigger for a default is that a company is unable to refinance. But this is also unlikely as most companies took advantage of low-interest rates to lock in low rates and extend the maturities of their bonds.So corporate debt investors are looking to the so-called maturity walls, and they’re not too worried, at least for now, that companies can find a plan to repay them.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
New Zealand election 2023: NZ’s political maverick David Seymour says party has Teal streakLibertarian David Seymour’s party could prove critical in deciding the next New Zealand government after weekend elections.
Read more »
Exxon shale boss David Scott, an Australian, arrested in Texas in sexual assault caseDavid Scott, vice president of the energy giant’s upstream unconventional unit, faces accusations of second-degree felony assault.
Read more »
Rebecca Loos responds following David Beckham tell-all docuseries7NEWS brings you the latest local news from Australia and around the world. Stay up to date with all of the breaking sport, politics, entertainment, finance, weather and business headlines. Today's news, live updates & all the latest breaking stories from 7NEWS.
Read more »
David Marr confronts his family’s history – Full Story podcastitemprop=description content=Journalist David Marr speaks to Jane Lee about how he discovered his family’s role in Australia’s frontier wars
Read more »
Gold Coast GP David Richards banned from contact with female patients by Health OmbudsmanDavid Richards must not have contact with female patients or work outside the Gold Coast where clinic he is based, under conditions imposed by the Health Ombudsman.
Read more »