“The high-yield bond market has been one of the great recovery stories since the scariest days of the financial crisis. It could become scary again when the Federal Reserve begins raising rates and investors should think through the coming challenges.
“Looking back, junk bonds became one of the emblems of that crisis, with prices of the index that underlies the iShares iBoxx $ High Yield Corporate Bond ETF (HYG | B-64) dropping 31.77 percent in just six months from June 1 to Dec. 1, 2008, according to data from Morningstar.
“Not many people had the guts to buy at the bottom, but those who did have more than doubled their money—an annualized return of 14.06 percent from Dec. 1, 2008 through April 2015. This rivals the S&P 500 Index’s annualized total return of 16.55 percent over the same period.” Related ETFs: HYG, JNK, BIL, SJB. See the full story in ETF.com.