- Due to higher oil prices, ‘high yield’ bond yields are approaching historical lows while interest rates and inflation are increasing. Investors should be grateful for the amazing opportunity to unload.
- ‘High yield’ ETFs have grown from 0% to 10% of the total fixed income ETF market in less than 10 years.
- Apart from rising interest rates, illiquid ‘high yield’ primary markets in relation to the highly liquid secondary ETF markets signal potential Armageddon as there will be no buyers when the ETF trend reverses.
I usually look for investments where the risk is low and return is high as asymmetric risk reward situations provide the highest and safest returns. Today I’m going to do the opposite, discuss a high risk low reward investment. If you own or are attracted to higher yields, or want a short play, this article is for you. More →