One side of the market is about to drag down another, according to Oppenheimer’s head of portfolio strategy. And it’s still unclear which side will lose out.
High-yield bonds have taken a tumble this month, with popular tracking ETFs HYG and JNK down almost 3 percent in November, as yields have risen.
In fact, the move is so substantial that even though the yields on government bonds are rising as well, the spread between the yield on so-called “junk bonds” and the yield on Treasurys has remained elevated. This indicates that traders see more risk in the high-yield market than they have in the past.
