Moody's: Liquidity improves for junk-rated firms


Junk bonds may look overvalued - and BAML's gauge of their spread to Treasurys is the lowest since 2007 - but Moody's Liquidity Stress Index declined (a good thing) to 3.7% in May from 4% previously.

There's a bit of Soros' reflexivity at work here as the Index performs well when the junk-bond market performs well, and both seemingly feed off of each other. Its record-low level of 2.8% was set last April and the record-high of 20.9% was set in March 2009.

ETFs: HYG, JNK, HYLD, SJB, ANGL, HYLS, UJB, XOVR, QLTC

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Comments (1)
  • Paulo Santos
    , contributor
    Comments (33733) | Send Message
     
    When you can rollover or issue new debt, you don't default.
    3 Jun 2014, 03:45 PM Reply Like
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