Review:
High Yield Bonds
overall review score: 3.5
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score is between 0 and 5
High-yield bonds, also known as junk bonds, are corporate bonds that offer higher yields due to their higher risk profile.
Key Features
- Higher yields than investment-grade bonds
- Higher risk of default
- Issued by lower-rated companies
- Less liquidity than investment-grade bonds
Pros
- Potential for higher returns
- Diversification of fixed income portfolio
Cons
- Higher risk of default
- Lower credit quality of issuers