iShares iBoxx $ High Yield Corporate Bond ETF (HYG) - NYSEARCA
  • Fri, Apr. 22, 11:30 AM
    • After a tough start to the year, junk bonds are on a tear - now having returned 6% YTD, with the overall yield sliding to just 6.9% from 10% earlier in 2016.
    • The bigger action has been in the junkiest of the junk sectors, with paper rated CCC having returned a full 9% YTD, including that of low-grade energy companies having returned 10%.
    • The term "Goldilocks" has re-entered the lexicon, with bulls saying we've got an economy strong enough to prevent defaults, but not so strong as to warrant tighter monetary policy. The oil price crash? Yesterday's news, they say.
    • Marty Fridson says high-yield has returned to "extreme overvaluation" territory. Jeff Gundlach, however, calls junk bonds still somewhat cheap, though noting the high proportion of the lowest-quality paper being issued of late.
    • Bottom line, writes Robin Wigglesworth in the FT: The rally should continue if for no other reason than the world remains yield-starved.
    • ETFs: HYG, JNK, HIX, DHY, HYLD, PHT, EAD, HYT, JQC, CIK, DSU, HHY, SJB, NHS, ACP, PHF, MCI, FHY, KIO, ANGL, ARDC, VLT, CIF, AIF, MPV, MHY, PCF, DHG, IVH, HYLS, JSD, UJB, GGM, CJNK, QLTC
    • Now read: Pessimism Recedes (April 21)
    | Fri, Apr. 22, 11:30 AM | 5 Comments
  • Thu, Apr. 14, 2:55 PM
    • "Our fundamental outlook for leveraged credit remains constructive," says Global CIO Scott Minerd, noting spreads of more than 900 basis points in February are consistent with six-month default rates in the 9-10% range - an overestimation in his view.
    • Though spreads have narrowed since, Guggenheim is still finding bargains in both high-yield (HYG, JNK) and bank loans, and Minerd reminds bank loan borrowers in particular could benefit from the Fed's caution on rate hikes (bank loans tend to be floating rate).
    • Guggenheim's Floating Rate Strategies Fund (MUTF:GIFAX) is near the top of bank loan funds, with an average annual return of 2.84% over the last three years.
    • Bank loan ETFs: OXLC, BKLN, PPR, EFR, VVR, ECC, BGB, PHD, SRLN, NSL, BGX, FCT, BSL, AFT, EVF, SNLN, TSLF, FTSL, TLI, BHL
    | Thu, Apr. 14, 2:55 PM | 9 Comments
  • Tue, Apr. 12, 12:48 PM
    | Tue, Apr. 12, 12:48 PM | 1 Comment
  • Mon, Apr. 11, 3:23 PM
    • "Simply put, clients were not being compensated for credit risk," says the team of Matthew Mish and Stephen Caprio.
    • A slowdown in U.S. growth could be the catalyst that pricks the bubble, they say as speculative credits find it even more expensive to borrow.
    • It could be happening now as high-yield issuance is lower by 53% this year, and the lowest-grade paper (CCC ratings) yields 15.2% even after the big rally of the past couple of months.
    • If they're correct, the two say spreads to Treasurys could more than double to 16.4%. "Investors were herded into lower-quality credit risk for a yield pick-up of a couple hundred basis points ... But the fundamental problem is that the default risk is exponential, not linear in these securities."
    • ETFs: HYG, JNK, HIX, DHY, HYLD, PHT, EAD, HYT, JQC, CIK, DSU, HHY, SJB, NHS, ACP, PHF, MCI, FHY, KIO, ANGL, ARDC, VLT, CIF, AIF, MPV, MHY, PCF, DHG, IVH, HYLS, JSD, UJB, GGM, CJNK, QLTC
    | Mon, Apr. 11, 3:23 PM | 18 Comments
  • Mon, Apr. 4, 3:11 PM
    | Mon, Apr. 4, 3:11 PM | 2 Comments
  • Mon, Apr. 4, 11:01 AM
    • Moody's oil and gas Liquidity Stress Index (LSI) hit a record high of 31.6% in March, up from 27.2% in February. The overall LSI rose to 10.3% from 9%.
    • The LSI measures the percentage of issuers with Moody's lowest liquidity rating of SGL-4.
    • "The composite LSI’s rise is echoing the climb following the last major turn in the credit cycle that started in mid-2007 and ultimately led to an LSI peak of 20.8% in March 2009," says Moody's John Puchalla, and though this spike is mostly about energy, liquidity cracks are beginning to show outside of that sector.
    • The non-oil and gas LSI rose to 4.8% in March from 4.1% previously, It's the highest level since 2010, but well-below the long-term average of 6.5%.
    • ETFs: HYG, JNK, HIX, DHY, HYLD, PHT, EAD, HYT, JQC, CIK, DSU
    • Now read: Is High Yield Signaling An All Clear? (April 4)
    | Mon, Apr. 4, 11:01 AM
  • Fri, Apr. 1, 1:13 PM
    • iShares Core U.S. Aggregate Bond ETF (NYSEARCA:AGG) - monthly distribution of $0.2215. 30-Day Sec yield of 2.10%.
    • iShares Barclays 20 Year Treasury Bond Fund ETF (NYSEARCA:TLT) - monthly distribution of $0.2704. 30-Day Sec yield of 2.48%.
    • iShares iBoxx $ High Yield Corporate Bond Fund ETF (NYSEARCA:HYG) - monthly distribution of $0.3793. 30-Day Sec yield of 6.98%.
    • iShares S&P National Municipal Bond Fund ETF (NYSEARCA:MUB) - monthly distribution of $0.1824. 30-Day Sec yield of 1.46%.
    • iShares iBoxx $ Investment Grade Corporate Bond Fund ETF (NYSEARCA:LQD)- monthly distribution of $0.3322. 30-Day Sec yield of 3.42%.
    • iShares Barclays 1-3 Year Treasury Bond Fund ETF (NYSEARCA:SHY) - monthly distribution of $0.0506. 30-Day Sec yield of 0.74%.
    • Payable Apr. 7; for shareholders of record Apr. 5; ex-div Apr. 1. 30-Day Sec yield as of 03/30/2016.
    | Fri, Apr. 1, 1:13 PM
  • Thu, Mar. 31, 4:12 PM
    • The DJIA (NYSEARCA:DIA) notched a 1.5% gain in Q1, the S&P 500 (NYSEARCA:SPY) a 0.8% advance, and the Nasdaq (NASDAQ:QQQslipped 2.7% as a furious rally since mid-February lifted stocks from one of their worst-ever starts to a year.
    • Joining the Dow and S&P as unlikely gainers (at least in mid-Feb.) in Q1 were high-yield bonds, with HYG up 1.4% for the quarter and JNK +1%. WTI crude oil sunk into the $20s earlier this year, but finished the quarter down just slightly at $38.16 per barrel.
    • The big rally in risk assets wasn't enough to derail bull moves in gold and Treasurys, both of which posted their best quarters in years (gold's best Q in three decades).
    | Thu, Mar. 31, 4:12 PM | 14 Comments
  • Tue, Mar. 29, 3:51 PM
    • High-yield debt has made a furious comeback over the past few weeks, including a 4% gain just this month - the largest monthly gain in five years.
    • Too far too fast, say the bears, pointing to weakening corporate earnings and desperate central banks. The problem with shorting corporate paper, though, is that it's time-consuming and expensive. But what about just shorting a high-yield index through a derivative?
    • The trouble with that - at least in the past - is that Markit's main U.S. high-yield CDS index failed to sufficiently track the performance of the paper of energy companies. That's changed now. Launched on Monday was an updated version with a 16% allocation to energy and materials company - up three hundred basis points from previously. Talk about timing.
    • Source: Bloomberg Gadfly
    • High-yield is rallying today, helped along by Janet Yellen's dovish remarks. HYG +0.3%, JNK +0.25%
    | Tue, Mar. 29, 3:51 PM
  • Thu, Mar. 24, 11:28 AM
    • According to S&P, the average corporate credit rating is BB-, or two notches below investment grade. A 15-year low means this gauge is weaker today than at the height of the financial crisis.
    • At work here - beside the raft of energy and commodity-related downgrades - are easy corporate lending conditions which allow those companies with weaker credit ratings to tap the borrowing market.
    • Unfortunately, says S&P, lower-graded issuers seeking to refinance in the coming months are going to find less welcoming conditions. "A recalibrated, smaller, and more conservative lending environment, where restricted capital market access will enable lenders to better dictate terms and conditions, could prompt liquidity challenges, accelerate downgrades, and ultimately lead to a spike in defaults."
    • ETFs: HYG, JNK, LQD, HIX, HYLD, DHY, PHT, EAD, HYT, JQC, CIK, DSU, CORP, HHY, SJB, PHF, NHS, FHY, ACP, MCI
    | Thu, Mar. 24, 11:28 AM | 12 Comments
  • Wed, Mar. 23, 9:10 AM
    • There's typically very little relationship between the returns on non-energy junk bonds and the price of oil, but the correlation between the two has soared of late to an all-time high of nearly 0.65 (with 1.00 being an exact match), according to Deutsche Bank.
    • Non-energy junk bonds make up about 88% of the high-yield market, according to BAML, which says the tight linkage today means investors aren't paying enough attention to growing risks among junk issuers. Among them: As the price of oil rises, junk bond prices improve even as costs high-yield issuers like manufacturers and transportation companies.
    • ETFs: HYG, JNK, HIX, HYLD, DHY, PHT, EAD, HYT, JQC, CIK, DSU, HHY, SJB, PHF, NHS, FHY, ACP, MCI, KIO, VLT, ARDC, ANGL, CIF, AIF, MHY, PCF, MPV, DHG, HYLS, IVH, JSD, UJB, GGM, CJNK, QLTC
    | Wed, Mar. 23, 9:10 AM | 6 Comments
  • Fri, Mar. 18, 9:29 AM
    • With another week of inflows ($2.01B last week), U.S. high-yield funds have now recorded five straight weeks of inflows since what may or may not be a major bottom on Feb. 11. Over just the last four weeks, funds have drawn in $11.52B, the largest-ever one-month gain for that asset class, according to BAML.
    • BAML's Michael Contoupolos, however, pulls out the yellow flag: "The fundamental backdrop has not changed and defaults are in fact increasing ... These inflows are an over-reaction to transitory tailwinds ... The recent rally has limited staying power."
    • ETFs: HYG, JNK, HIX, HYLD, DHY, PHT, EAD, HYT, JQC, CIK, DSU, HHY, SJB, PHF, NHS, FHY, ACP, MCI, KIO, VLT, ARDC, ANGL, CIF, AIF, MHY, PCF, MPV, DHG, HYLS, IVH, JSD, UJB, GGM, CJNK, QLTC
    | Fri, Mar. 18, 9:29 AM | 13 Comments
  • Fri, Mar. 11, 12:49 PM
    • While the big Wall Street banks are struggling with slides in fixed-income revenues, business is booming at BlackRock (NYSE:BLK) and other ETF providers offering credit-related products.
    • The banks, writes Lisa Abramowicz, want some of that business back.
    • The issue for banks are new regulatory and capital rules which make it harder to hold big inventories are paper investors want to trade. Meanwhile, the ease of moving in and out of vehicles like BlackRock's $25B IG bond fund (NYSEARCA:LQD) or its $16B junk-bond fund (NYSEARCA:HYG) have led to surging volumes, even as the individual securities underlying those ETFs are more difficult to trade.
    • Banks are responding with the total-return swap in which an investor pays a fee to a counterparty who promises delivery of the total gain on a basket of certain debt. These instruments are not only quickly traded without having to deal with the underlying securities, but are pegged to some of the same indexes as the biggest credit ETFs. Citigroup (NYSE:C) just became the eight dealer in these derivatives (joining GS, BAC, JPM, MS, CS, DB and OTCQX:BNPQY), which are being pitched by banks as an alternative to ETFs.
    | Fri, Mar. 11, 12:49 PM | 8 Comments
  • Fri, Mar. 11, 8:35 AM
    • U.S. corporate investment-grade funds saw the most inflows in a year in the week ended March 9, while loans funds had their first inflows since mid-2015, Lipper said late yesterday.
    • IG funds saw inflows of $2.18B vs. outflows of $761M in the previous week. Most inflows since Feb. 2015.
    • Loans funds saw inflows of $55M vs outflows of $357M in the prior week. This marks the first week of inflows since July 2015.
    • Corporate high-yield funds saw inflows of $1.8B, vs. inflows of $4.97B last week. This was the fourth straight week of inflows.
    • U.S. government Treasury funds saw outflows of $326M vs. outflows of $2.08B in the previous week. The second straight week of outflows.
    • U.S. government mortgage funds had inflows of $547M vs. inflows of $425M a week ago.
    • Muni funds had inflows of $518M vs. inflows of $212M a week ago. 23rd straight week of inflows.
    • ETFs: HYG, JNK, LQD, HIX, HYLD, DHY, PHT, EAD, HYT, VCSH, JQC, VCLT, CIK, VCIT, DSU, CORP, HHY, SJB, CSJ, PHF, NHS, FHY, ACP, MCI, KIO, VLT, CIU, ARDC, ANGL, CSI, CIF, AIF, MHY, PCF
    | Fri, Mar. 11, 8:35 AM | 1 Comment
  • Thu, Mar. 10, 2:25 PM
    • The agency expects high-yield bond defaults to hit 6% this year, way up from 4.5% in its previous forecast, and at what would be the highest non-recessionary rate since 2000.
    • Energy, metals, and mining issuers have already had $18B in defaults in 2016, and Fitch sees that number rising to $70 by year-end.
    • The coal subsector default rate will hit "an astounding" 60% this year, says Fitch.
    • This just in: HYG and JNK are flat for the year while yielding in the area of 6%.
    | Thu, Mar. 10, 2:25 PM | 2 Comments
  • Fri, Mar. 4, 7:42 AM
    | Fri, Mar. 4, 7:42 AM | 9 Comments
HYG Description
The iShares iBoxx $ High Yield Corporate Bond Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the iBoxx $ Liquid High Yield Index, a corporate bond market index compiled by the International Index Company Limited.
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Country: United States
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