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High Yield Related News
 in chronological order

 See also: High Yield Related Books, High Yield Related Scholarly Papers, or High Yield Home Page.

Table of Contents:
 

Feltus sees great value in junk debt
September 22, 2008
From Reuters:
 U.S. high-yield bonds are great buys as spreads are trading at "ridiculous levels," Andrew Feltus, senior vice president and portfolio manager at Pioneer Investments, told the Reuters 2008 Restructuring Summit.

Feltus, who oversees about $8 billion in high-yield assets, said default rates of between 13 percent and 16 percent are "baked in the cake" for high-yield bonds. "The market is at very extreme valuations," Feltus said, adding securities are the cheapest ever.

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Why Buy High Yield Bond Funds?
September 15, 2008
From Seeking Alpha:
 I've been investing in high yield (more commonly known as junk) bonds for years, which has taught me a lot about their ups and downs. I hope this information can be used to give guidance for future investing.

History

In the 1980s, a few junk bonds were available on the NYSE and the over-the-counter market. Not only did they offer high yields, but brokerage commissions were modest. The high yields on junk bonds were necessary because their bond ratings were generally rated B or even CCC (BBB is the minimum rating for investment quality bonds). While the high yields were attractive, bumps in the road reinforced the idea that they also carried risk (i.e., bond defaults).

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FUND VIEW-Investec sees value in high-yield bonds
April 23, 2006
From Guardian.co.uk:
 Even though company defaults have yet to start in earnest, investors could profit by favouring high-yield bonds over government debt and stocks as historically they outperform when a recession gets under way, according to Investec Asset Management.

The fund manager, part of Investec Group says investment-grade corporate debt offers the best relative value in credit markets, but that returns on double-B and single-B-rated junk bonds are attractive relative to other assets, particularly versus equities.

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Merrill high-yield strategist Garman launches firm
April 21, 2006
From Reuters:
 Christopher Garman, the former head of high-yield strategy at Merrill Lynch (MER.N: Quote, Profile, Research), has launched an independent research firm, Garman Research.

Garman told Reuters on Monday that his research will not only focus on credit opportunities in high-yield and investment-grade markets, but various other asset classes, including bank and leveraged loans and public equity, as sectors have become ever more interlinked.

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Do High-Yield Junk Bonds Translate Into High Returns?
April 3, 2006
From WebCPA:
 There seems to be a very high correlation between the demand for high-yield (junk) bonds and the level of interest rates. The fall in Treasury bond rates during the second half of 2007 has once again led many investors to search for higher yields. In addition, the sub-prime crisis in residential mortgages of the summer of 2007, has led to a general flight to quality and all credit and liquidity spreads have widened. The combination of lower Treasury rates and wider credit spreads has increased the attractiveness of high-yield bonds for many investors. The question is: Does the high yield on junk bonds make them appropriate investments to consider as part of the fixed income portfolio. The place to begin to answer that question is to ask: What role should fixed income play in a portfolio?

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RLPC-UPDATE 1-Alltel may sell $2 bln high-yield bonds
April 3, 2006
From Reuters:
 Rural mobile service provider Alltel Corp will attempt to sell $2 billion in high-yield bonds next week, two traders told Reuters Loan Pricing Corp on Thursday.

The bonds are part of a $5.2 billion cash-pay bond offering that backs the company's leveraged buyout. They are expected to have a 13 percent coupon.

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Rating agencies dismiss junk verdict on bond insurers
March 14, 2006
From Reuters:
 For the market the evidence for judging bond insurers MBIA Inc. (MBI.N: Quote, Profile, Research) and Ambac Financial Group (ABK.N: Quote, Profile, Research) is clear and the junk bond verdict is in.

For credit rating companies, the deliberation goes on and on.

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UK's Abbot to test high yield bond market-source
March 13, 2006
From Reuters:
 British oil rig builder and operator Abbot Group is expected to launch a high yield bond in the coming months, a source familiar with the deal said on Thursday.

The issue could reopen the European high-yield corporate bond market which has been closed since July when global power generation firm InterGen had to raise yields twice to get its bond away due to volatile markets.

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Investors lured by $8 billion high-yield disaster bonds
February 26, 2006
From Reuters:
 Investors are flocking to insurance-risk bonds that offer high yield at relatively low risk in turbulent credit markets, bankers said on Monday.

The sale of disaster bonds by insurers, transferring the potentially crippling cost of earthquakes, hurricanes and floods to capital markets investors, beat the credit crunch to soar to some $8 billion (4 billion pounds) globally in 2007, nearly double the previous year's figure.

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Few positives for US high-yield bonds in the near term - S&P
February 25, 2006
From CNNMoney.com:
 Standard & Poor's (NYSE:MHP) Ratings Services said said there were few positives for the high-yield bond market in January and early February as investors and banks are still working out prices for the billions in backlogged debt.

With recessionary expectations revised upward and profits expected to trend downward, S&P said it sees little evidence to support high-yield bonds in the near term.

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NY professor sees junk bond defaults at 4.64 percent: report
February 6, 2006
From Reuters:
 A New York University professor is projecting that high-yield "junk" bonds will default at a rate of 4.64 percent this year, the highest since 2003, The Wall Street Journal reported on Wednesday.

Edward Altman, professor of finance at New York University, is due to announce his outlook in a report later in the day, it said.

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Negative pressures to continue for US high yield market - Fitch
February 5, 2006
From Forbes:
 Fitch Ratings said negative pressures will continue for the US leveraged loan and high yield markets at least through the early part of 2008.

The ratings agency said weak economic growth along with continuing difficulties in the housing and financial sectors will put upward pressure on risk premiums and stress on valuations.

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Investment banks face shrinking bond sales
January 8, 2006
From Crain's New York Business:
 Wall Street’s leading trade group has joined the chorus predicting tough times ahead for investment banks. It is forecasting double-digit percentage declines this year in the sales of most types of bonds.

The Securities Industry and Financial Markets Association projects that total bond issuance will decline by a whopping $600 billion, or 15% in 2008, to $3.4 trillion. That would represent the steepest such drop since 2004, when a momentary spike in interest rates chilled the market.

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Junk Bond Defaults to Rise Fivefold, Moody's Says (Update4)
January 8, 2006
From Bloomberg:
 The global default rate on high-yield, high-risk bonds will jump more than fivefold by the end of 2008, according to Moody's Investors Service.

The high-yield default rate will increase to 4.8 percent this year and reach 5 percent in 2009 because a weakening economy and ratings cuts will cause more issuers to miss their interest payments, Moody's analyst Kenneth Emery in New York said in a report released today. The default rate finished 2007 at a 26- year low of 0.9 percent.

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Innovative financing makes Michael Milken a success
December 26, 2006
From Ohio.com:
 I had the opportunity recently to catch up with legendary financier Michael Milken. For me, this was a chance to see my investing mentor, since I've spent most of my investment career in distressed securities.

Starting in 1969, Milken's central investment thesis was that many AAA-rated bonds would have a higher default rate than single B industrials. As an example, he would cite that AA-rated railroads defaulted at a higher rate than B-rated industrials from 1900 to 1970.

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Do High Yield Bonds Translate Into High Returns?
December 23, 2006
From Seeking Alpha:
 "Well-informed investors avoid the no-win consequences of high-yield fixed income investing." (David Swensen, Unconventional Success, p. 109)

There seems to be a very high correlation between the demand for high-yield (junk) bonds and the level of interest rates. The fall in Treasury bond rates during the second half of 2007 has once again led many investors to search for higher yields. In addition, the subprime crisis in residential mortgages of the summer of 2007, has led to a general flight to quality and all credit and liquidity spreads have widened. The combination of lower Treasury rates and wider credit spreads has increased the attractiveness of high-yield bonds for many investors. The question is: Does the high yield on junk bonds make them appropriate investments to consider as part of the fixed income portfolio. The place to begin to answer that question is to ask: What role should fixed income play in a portfolio?

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Defaults to Quadruple as More Companies Cut to Junk (Update2)
December 18, 2006
From Bloomberg:
 U.S. corporate defaults probably will quadruple next year after the number of companies that lost their investment-grade credit ratings rose at the fastest pace since 2003.

Moody's Investors Service predicts companies will default on 4.7 percent of their bonds in 2008 as the economy slows, up from 1 percent this year. Jones Apparel Group Inc., the Bristol, Pennsylvania-based maker of Nine West shoes, mortgage lender Residential Capital LLC and 31 other companies with a combined $52 billion of debt were downgraded to junk by Moody's this year.

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European high-yield default risk limited in 08 -UBS
December 18, 2006
From Reuters:
 Around two-thirds of European high-yield companies in the Crossover index do not need to refinance in 2008, which should limit the risk of corporate defaults over the next year, UBS credit strategists said.

Thirty-four of the 50 names in the Crossover index <ITCRS5EA=GFI>, made up mostly of speculative-grade companies, face no refinancing of public debt next year while 27 have nothing due in 2009 either, UBS credit strategists wrote in a note on Tuesday.

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Buffett buys $2B in TXU bonds
December 3, 2006
From FORTUNE:
 Warren Buffett put $2 billion of Berkshire Hathaway's cash to work at the end of last week when the company purchased high-yielding bonds issued by Dallas-based power producer TXU Corp., according to a person familiar with the deal.

TXU was bought earlier this year in a landmark $45 billion leveraged buyout led by Kohlberg Kravis Roberts. As with many LBOs carried out in buoyant markets, banks agreed to make large so-called bridge loans to help finance the deal, but they got stuck with those loans when demand dried up for LBO-related debt. TXU can now use the proceeds from the bond sale, whose total size was $3.9 billion, to help pay down the bridge loans. The bonds were issued through a subsidiary.

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Bonds: More risk can pad your yield
December 2, 2006
From The Arizona Republic:
 Talk about throwing the baby out with the bath water.

As the credit crunch lingers, many investors have fled to the safety of Treasury securities while giving a cold shoulder to just about everything else in the fixed-income world.

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Alltel units price $1 billion high-yield notes
November 19, 2006
From Reuters:
 Two Alltel Corp. subsidiaries late on Friday priced a $1 billion bond issue to help repay debt for the company's leveraged buyout, Alltel said on Monday.

Market sources had said on Friday that the deal was being postponed because of difficult market conditions. At least four junk bond sales have been pulled this month after massive mortgage-related losses at major banks took a toll on investors' risk appetite.

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N.Z. Dollar May Fall as Investors Shun High-Yield Currencies

November 19, 2006
From Bloomberg:
 The New Zealand dollar may fall on concern credit-market losses will prompt investors to shun high- yielding currencies funded with loans in yen.

New Zealand's benchmark interest rate is 7.75 percentage points higher than Japan's, making the currency a favorite for the so-called carry trade, where funds borrowed in countries with lower borrowing costs are invested in places offering higher yields. The trades are considered risky because the currency's fluctuations can erase the profit earned on the interest-rate gap.

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High-Yield Market Poised To Stall
November 12, 2006
From The Wall Street Journal Online:
 THE EUROPEAN high-yield-bond market has evolved over the past couple of years amid the bull run on credit, but its development is expected to be hampered over the next year as a result of the summer credit crisis.

In a survey of U.K. and European high-yield investors conducted by Financial News, in cooperation with the European High Yield Association, respondents were bearish on the outlook for the asset class and saw a deterioration in credit posing the greatest risk to stability.

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Toggle bonds return to favor
November 8, 2006
From The International Herald Tribune:
 The most toxic part of the junk bond market is suddenly back in favor.

Companies raised about $4.4 billion in the past six weeks selling toggle bonds, securities that allow borrowers to pay interest in cash or with more debt, data compiled by Bloomberg show. Demand dried up in July and prices fell as much as 16 cents on the dollar as defaults on subprime mortgages contaminated global credit markets, according to data compiled by Bloomberg.

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Country Garden Seeks Record $1.5 Billion Bond Sale, People Say

October 31, 2006
From Bloomberg:
 Country Garden Holdings Co., China's most profitable builder, may raise as much as $1.5 billion from an overseas bond sale, the biggest by a Chinese property company, according to three people familiar with its plan.

The sale by a company which counts Hong Kong billionaires and developers Lee Shau-Kee and Cheng Yu-tung among its shareholders, will eclipse Shimao Property Holdings Ltd.'s $600 million debt sale last November. Investors placed orders for more than eight times the $500 million that Shanghai-based Shimao initially offered.

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High-yield record heralds recovery
October 30, 2006
From FinancialNews-US.com:
 The volume of high-yield debt financing, a type of debt used to fund private equity-backed buyouts, has reached the highest monthly total, according to data provider Dealogic, suggesting the industry is on the road to recovery following the summer’s credit crunch.

Syndication of debt used to fund a slew of buyouts stalled earlier in the year as the credit crunch took hold, forcing banks to hang on to large tranches of debt or renegotiate financing arrangements for buyout deals.

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Merrill named sole bookrunner to sell $357m in junk bonds
October 19, 2006
From FinancialNews-US.com:
 UK oil and gas company Melrose Resources is set to test the fragile appetite for high-yield debt in Europe after mandating Merrill Lynch as sole bookrunner to sell €250m ($357m) worth of junk bonds – the first euro denominated transaction of its kind in over 80 days.

A four-day investor roadshow across Europe is to start on Monday for the eight-year subordinated transaction with launch and pricing of the bonds expected either by the end of next week or in the first few days of the week after, Merrill Lynch said.

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UPDATE 1-Melrose to test market with high yield bond
October 18, 2006
From Reuters UK:
 British-based oil and gas explorer Melrose Resources Plc (MRS.L: Quote, Profile , Research) said on Thursday it plans to issue a 250 million euro ($355 million) bond which will be the first high yield euro non-financial issue since the summer.

Proceeds from the bond, due 2015, "will be used to refinance the existing indebtedness of the company and will provide additional working capital," Melrose Resources said in a statement.

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Land Securities Joins The High Yield Portfolio
October 3, 2006
From Fool.co.uk:
 It's the first article for October which means that it's time for the latest selection for my fourth High Yield Portfolio (HYP). My fourteenth share is FTSE100 member Land Securities (LSE: LAND) . Some readers may feel that LandSecs is a bit too similar to existing HYP4 holding Persimmon (LSE: PSN) and I have to admit that there is a little overlap.

The facts are that Persimmon builds residential property for sale, not investment, whilst LandSecs is a commercial property developer and investor, not a build and sell operation. Consequently, although they are both involved in property, I feel that the types of property and the nature of their operations are sufficiently diversified to hold both in a portfolio of this size. I wouldn't though hold both in an HYPLite consisting of five or other small number of shares.

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Foreign Bonds, High Yield Top Performers Last Month
October 2, 2006
From CNNMoney.com:
 Foreign bonds and high-yield funds were the top performers in September, as the Federal Reserve cut key interest rates and the dollar continued to fall.

For the month of September, world income funds picked up 2.83%, according to Lipper.

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Hope for a thawing bond pipeline
September 24, 2006
From FinanceAsia.com:
 New bond issues announced after the US Fed's surprisingly large rate cut last week have sparked hope that Asia's G3 bond markets might soon emerge from the duldrums.

Last week sparked hope that Asia’s frozen bond pipeline is beginning to thaw following the US Federal Reserve’s unexpected half-a-percent cut in the policy and discount rate on September 18.

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Junk Bonds: What Now?
September 24, 2006
From BusinessWeek:
 Former Merrill chief high-yield strategist Martin Fridson on what investors need to know

The dramatic half-point interest rate cut by the Federal Reserve on Sept. 18 gave investors a boost, but the turmoil in the global credit markets is not over. How long will it last and how bad will it get? Martin Fridson, a junk-bond veteran and stock market historian who has had a courtside seat through several credit booms and busts over the past quarter-century, says this crunch has a long way to go. Fridson set up his own shop, FridsonVision, in 2002 after a long stint at Merrill Lynch (MER ) as director of global high-yield strategy. Contributing economics editor Christopher Farrell asked him what he thinks is in store for junk bonds.

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ANALYSIS-Aussie dollar new darling of the high-yield crowd
September 12, 2006
From Reuters:
 The Australian dollar has suffered as investors fled to safer assets amid turmoil in global markets but sound economic fundamentals and continuing high interest rates could see it emerge as the most sought-after high-yielding currency.

For investors seeking high returns, the Aussie has often played second fiddle to the New Zealand dollar, which boasts the loftiest official benchmark rate in the industrialised world at 8.25 percent.

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High-Yield Funds Fail To Offer Relief in Turmoil
September 12, 2006
From The New York Sun:
 The market's meltdown in recent weeks has sent investors scurrying for safety. For instance, unprecedented amounts of money have flowed into U.S. Treasury securities and large high-quality growth stocks. What about high-yield stocks? Aren't they supposed to be a safe haven as well?

Lipper reports that during the three months that ended August 31, the 271 equity income funds it tracks traded down 3.8%, almost exactly in line with the S&P 500. Large-cap growth stock funds, by contrast, were off less than 1%. Many income funds were hurt by their holdings of relatively high-yielding financial services and real estate stocks, both sectors blown up by the subprime mortgage fiasco.

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LBO jitters are '80s revival; cue the burning bed?
September 5, 2006
From MarketWatch:
 Private equity firms and investment banks bag companies with borrowed money in record numbers, helping to send the stock market to new heights.

But then investors become fickle, refusing to finance a few risky deals in the debt market - casting doubt on the fate of outstanding buyouts dreamt up when cheap financing flowed freely.

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Market Spotlight: Junk Bonds
September 4, 2006
From Forbes:
 Issuers of high yield junk bonds will try to determine in September whether investors are up for taking on risk after the market was brought to an almost complete standstill last month.

Market players unnerved by the deterioration of the below prime mortgage market had vehemently turned against junk bonds and other assets carrying high levels of risk.

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US HIGH YIELD-Credit squeeze triggers rise distressed debt
August 23, 2006
From Reuters:
 The distressed debt market may be finally coming to life as fallout from the U.S. subprime mortgage debacle creates an increase in the volume of discounted bonds, and more could be on the way if economic growth loses momentum.

The number of distressed bonds, those that yield at least 10 percentage points more than Treasuries, tripled to 66 as of Aug. 15 from 22 in July, according to a recent Merrill Lynch report.

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Bank of America Broadens High Yield Research Coverage With Addition of Lionel Jolivot
August 20, 2006
From CNNMoney.com:
 Bank of America today announced that Lionel Jolivot will join Banc of America Securities as a principal and senior research analyst. In this role, he will provide high yield debt research on the Services, Industrials, Aerospace & Defense sectors. Jolivot will be based in New York and will report to Larry Bland, Global Head of High Yield Debt Research.

"We look forward to welcoming Lionel to the debt research team and in turn, broadening our sector coverage," said Paula Dominick, Global Head of Research. "Our clients will value his deep insights and extensive knowledge of the General Industrials sector."

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High-yield bonds weaken as trading dries up
August 16, 2006
From Reuters:
 Demand for U.S. high-yield bonds dropped on Thursday and trading slowed, traders said, after Countrywide Financial Corp. (CFC.N: Quote, Profile, Research), the largest U.S. mortgage lender, said it was drawing an $11.5 billion credit facility to bolster liquidity.

The move prompted all three major rating companies to cut ratings of Countrywide. Moody's Investors Service and Fitch Ratings also cut ratings of mortgage lender Residential Capital, GMAC's home lending unit, to junk status. For details, see [ID:nN16331783].

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Delaware Investments Names Kevin P. Loome Head of High-Yield Investments
August 15, 2006
From CNNMoney.com:
 Delaware Investments today announced that Kevin P. Loome has joined the company's fixed income team as Senior Vice President, Senior Portfolio Manager, and Head of High-Yield Investments, effective immediately. In this role, Mr. Loome is responsible for portfolio construction and strategic asset allocation of all high yield assets.

Prior to joining Delaware Investments in August 2007, Mr. Loome spent 11 years at T. Rowe Price, starting as an analyst and leaving the firm as a portfolio manager for two T. Rowe Price funds. He began his career with Morgan Stanley as a corporate finance analyst in the New York and London offices. Mr. Loome received his bachelor's degree in commerce from the University of Virginia and earned an MBA from the Tuck School of Business at Dartmouth. He earned his Chartered Financial Analyst designation in 1999.

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High-yield bonds rally as market sentiment rises
August 8, 2006
From MarketWatch:
 Prices of high-yield bonds spiked up Wednesday as money moved back into more credit-risky debt.

"The day's move was one of the year's most impressive," said Justin Monteith, a KDP Investment Advisors Inc. analyst, said on Wednesday in a phone interview from his Montpelier, Vermont, office.

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Fidelity U.S. High-Yield Fund Has No Subprime Debt (Update2)

August 3, 2006
From Bloomberg:
 Fidelity International Ltd. said its U.S. and Asian high-yield funds have no U.S. subprime mortgage investments or collateralized debt obligations.

Fidelity International, a unit of Boston-based Fidelity Investments, the world's largest mutual-fund company, sees buying opportunities in U.S. and Asian high-yield markets, portfolio managers Harley Lank and Andrew Wells said in a market update late yesterday titled ``Sub-prime or a prime opportunity?''

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Gross Tells CNBC: 'Earthquake' in High-Yield Could Hit Stocks
July 24, 2006
From CNBC:
 The high-yield corporate bond market has gone through "a dramatic earthquake" in the past six weeks because of surging interest rates and that move could impact stocks, Pimco founder and chief investment officer Bill Gross told CNBC.

Gross, whose firm has about $700 billion in assets under management said on "Street Signs" that the fallout could hurt stocks as well.

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Yield Premium on Junk Debt Rises to Most in 18 Months (Update1)
July 24, 2006
From Bloomberg:
 The extra yield investors demand to own below-investment grade bonds surged to the most in more than 18 months as a measure of their risk increased and a mortgage lender reported more consumers fell behind on home-equity debt.

High-yield spreads relative to U.S. Treasuries jumped 17 basis points to 361 basis points, the fourth one-day increase of 15 basis points or more this month, according to Merrill Lynch & Co. index data. The increase puts July on course to become the worst month for junk-rated debt premiums in more than five years. A basis point is 0.01 percentage point.

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Counting On A High Yield
July 16, 2006
From The Motley Fool:
 Nothing grabs my attention in quite the same way as a plunging share price. You see, if a share price has fallen substantially, the sweet prospect of value presents itself as a possibility. So with this in mind, I've been doing my sums on Abacus Group (LSE: ABU) and, pleasingly, the current valuation does appear to be attractive.

The company describes itself on its website as 'one of the leading distributors of electronic components in Europe'. I like distribution companies as a business model; it is so simple -- you buy stuff, you move it you sell it. There are no complicated issues involving highly qualified staff, manufacturing or marketing. You let your suppliers and customers do all that, and just skim off an income by moving stuff from one to the other. By investing in distribution companies, we can ride the fortunes of an entire industry in a relatively benign way. It is this last point that provides both opportunity and threat in Abacus as its business is today.

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Western Europe's economic resilience boosts high-yield credit quality - Moody's
July 12, 2006
From Forbes:
 Moody's Investors Service says vigorous economic growth in Western Europe has strengthened business sales and more than offset the impact of higher interest rates, giving an unexpected boost to credit quality.

Moody's (nyse: MCO - news - people ) said the turnaround in Western Europe's overall credit quality occurred more rapidly and more vigorously than anticipated, due to benign economic conditions, relatively low gearing in the overall corporate sector, better-than-expected revenue inflows and favourable financing conditions.

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US HIGH YIELD-US junk bonds sell off, threatening LBO financing
July 10, 2006
From Reuters:
 The U.S. junk bond market is being shaken by the subprime market, raising concerns about the viability of a number of proposed high-yield debt sales which are tied to company buyouts.

Junk bonds sold off on Tuesday, turning an already fragile financing market uglier, after ratings warnings on billions of dollars of subprime mortgage-related bonds snuffed out appetite for risky debt.

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A High Yield Builder Joins The Portfolio
July 4, 2006
From The Motley Fool:
 It's the first article for July and housebuilder Persimmon (LSE: PSN) is the latest selection for my fourth High Yield Portfolio. Price weakness over the last six months has driven the yield up by a sufficient margin to make it the next share on the descending FTSE 100 forecast yield rankings in a new sector which I deem suitable on the fundamentals to hold in this portfolio.

As a matter of interest another share in a new sector, yellow pages publisher Yell Group (LSE: YELL) , is very slightly above Persimmon on forecast yield so at first I chose it. However closer investigation revealed that it has a monstrous level of debt so I ruled it out subsequently.

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Reaching for High Yield Leads Market from Boom to Bust
July 2, 2006
From The Daily Reckoning:
 There is nothing like a long spell of good luck to ruin a man. He begins to think he can get away with anything. The next thing you know, he is wagering big money in Las Vegas and chatting up stewardesses.

Right now, the whole world economy is enjoying a spell of catastrophic prosperity. That is to say, things are going far too well…for far too many people.

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Two Junk Bonds Deals Sell After Underwriters Change Terms
June 28, 2006
From CNNMoney.com:
 Two high-yield bond deals stumbled Thursday, but the underwriters managed to find willing investors after they altered the terms of financing that will help fund leverage buyouts.

This comes after several deals were postponed indefinitely over the last week, including the U.S. Foodservice multi-billion debt package that signaled to investors that future deals could be in trouble.

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Southern Company: The Value of High Yield Stocks
June 20, 2006
From SeekingAlpha:
 We love to use high yield stocks as bond substitutes in about 25% of our Fixed Income Portfolio. That strategy isn’t appropriate for all investors because it entails assuming additional risk. But for those who can do so, there is little penalty to current income and it offers the opportunity to achieve higher returns. Part of that extra risk is in the form of longer duration (bond maven lingo), which, to ordinary guys like us, means increased price volatility when interests move. Right now, many investors are worried about long term interest rates rising, so the risk in owning a high yield stock is that if rates do increase, a high yield stock may decline more than a long term bond. We don’t happen to be as pessimistic about a move up in interest rates; so we view properly priced high yield stocks as attractive. In addition, if we stick to buying the stocks of companies that are raising their dividends every year, we think some of the ‘duration’ risk can be mitigated.

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Baillie Gifford's Barker finds high returns in high yield
June 19, 2006
From Reuters UK:
 A position in the Other Bond sector has kept Kenneth Barker off most fund buyer's radars, despite his Citywire AAA-rating.

Barker has been running the Baillie Gifford Corporate Bond fund since June 2001 and Baillie Gifford High Yield since launch in the same year.

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Junk-bond leader bets on debt, not rate boost
June 17, 2006
From The Seattle Times:
 The manager of the top-performing Pioneer Global High Yield Fund expects U.S. junk bonds to outperform those in Europe and emerging markets because the Federal Reserve will refrain from raising interest rates.

Andrew Feltus, who runs the fund at Pioneer Investment Management in Boston, said policymakers will hold their target interest rate at 5.25 percent for the next 12 months, encouraging economic growth and keeping risk premiums on speculative-grade debt close to record lows.

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LBO debt may price high but demand likely strong
June 15, 2006
From Reuters:
 Some high-yield bonds may price higher than companies originally expected as a rash of leveraged buyout-related financing is expected to hit the market in the coming months.

Demand for the debt, however, is expected to remain strong even as volatility in the Treasury market has raised concerns that LBOs may become more costly if funding costs rise, potentially making the deals less attractive to their sponsors.

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US HIGH YIELD-Casino bond yields fall in wake of buyout talk

June 5, 2006
From Reuters:
 The risk in owning high-yield casino bonds is at its lowest level in a year even though the industry is beset with acquisitions and leveraged buyouts that typically push yields higher.

Bonds of Trump Entertainment Resorts Inc. (TRMP.O: Quote, Profile, Research and Harrah's Entertainment Inc. (HET.N: Quote, Profile, Research have rallied as investors have grown more confident about the potential acquisition of the world's biggest casino operators.

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Expensive Junk

June 4, 2006
From The Wall Street Journal:
 Mutual funds focused on junk bonds -- high-yield bonds that ratings agencies consider speculative -- have been delivering anything but a junky performance this year. The group's 4.8% advance is the best of any Morningstar Inc. bond-fund category.

Attracted by the returns, investors have been shoveling money into junk-bond funds at a pace not seen since 2003. But can the junk-bond run continue?

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The High Yield Income Fund, Inc. Withdraws from Arca

May 24, 2006
From BusinessWire:
 The High Yield Income Fund, Inc. (NYSE: HYI) (the “Fund”) is today announcing that it plans to voluntarily withdraw its common stock from listing on NYSE Arca, Inc., formerly the Pacific Exchange. The Fund’s securities will continue to be listed on the New York Stock Exchange.

The decision to voluntarily withdraw listing from NYSE Arca, Inc. was made to eliminate duplicative administrative requirements and costs inherent with dual listings as a result of the NYSE Group’s recent merger with Archipelago Holdings, the parent company of NYSE Arca. NYSE Arca will continue trading the Fund’s securities on an unlisted trading privilege basis.

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Australian Dollar Advances on Investor Appetite for Risk, Yield

May 22, 2006
From Bloomberg:
 The Australian dollar advanced, snapping five days of losses, as rising appetite for risky investments lured traders to the nation's higher-yielding assets.

The currency gained as stock markets from China to the U.S. climbed yesterday, suggesting investors are searching for better returns. The local dollar has risen against 14 of the 16 most active currencies this year as investors have been attracted to Australia's key borrowing cost at a six-year high of 6.25 percent, 1 percentage point above the equivalent U.S. rate and 5.75 percentage points more than in Japan.

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Income boost for Aegon High Yield Bond fund

May 17, 2006
From Investment Week:
 Income payments on the Phil Milburn’s Aegon High Yield Bond fund are to be made on a monthly basis rather than a quarterly basis from 1 August.

This will also mean that charges will be taken from capital rather than income, boosting the monthly dividend.

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State Street Global Advisors Expands High-Yield Team

May 16, 2006
From BusinessWire:
 State Street Global Advisors (SSgA), the investment management arm of State Street Corporation (NYSE: STT), announced today the appointments of Jeffrey Megar, CFA, as leveraged loan manager and T.J. Gaylord as senior high-yield analyst in its Global Fixed Income group. Megar will report to Scott Richards, senior high-yield portfolio manager. Gaylord will report to Matthew Steinaway, head of global credit research.

Megar and Gaylord are joining a team made up of industry veterans with a strong track record in the sector, all of whom have worked together in past roles. Their addition continues an emphasis on broadening active credit management capabilities in SSgA’s Global Fixed Income group. Together with the recent addition of Richards and senior high-yield analysts Thomas Stolberg, CFA, and Charles Haley, CFA, they will serve to increase the breadth and depth of SSgA’s noninvestment-grade fixed income coverage.

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Bank of America's Lewis Says Credit Market Needs `More Sanity'

May 9, 2006
From Bloomberg:
 Bank of America Corp. Chief Executive Officer Ken Lewis said a so-called ``credit bubble'' is about to break after six years of historically low interest rates and relaxed lending criteria.

``We are close to a time when we'll look back and say we did some stupid things,'' Lewis said, speaking at a lunch at the Swiss-American Chamber of Commerce in Zurich. ``We need a little more sanity in a period in which everyone feels invincible and thinks this is different.''

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High-yield loan volumes lower bond recovery -Fitch

May 7, 2006
From Reuters:
 The amount of principal that high-yield bondholders are likely to be repaid in the event a company defaults on its debt may be lower than currently expected as borrowers load up their balance sheets with loans, Fitch Ratings said on Monday.

"Speculative grade balance sheets are becoming more loan-heavy and this threatens the future recovery prospects of unsecured bonds and may eventually lead to lower recovery rates on loans as well," Fitch said in a statement.

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If the yield looks too high to last, it's probably unsustainable

April 30, 2006
From BloggingStocks:
 When examining dividend-paying stocks, as with any investment, this is what you need to remember: If it sounds to good to be true, it probably is. The version of this adage that replies to dividend stocks is If the yield looks too good to last, it's probably unsustainable. The Sunday New York Times took a look at the dangers of high-yield stocks, and I though I would give my own three tips for avoiding big dividend nightmares like New Century Financial:

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US HIGH YIELD-Reception strong for Edison Mission

April 30, 2006
From Reuters:
 Independent power producer Edison Mission Energy is expected to garner ample demand for a $2.7 billion junk bond sale on Tuesday that will help the company refinance debt and lower interest expense.

The largest junk bond sale in four weeks, Edison Mission's deal is being helped by a relative scarcity of big, liquid bond issues, overall strength in the power industry and the company's strong cash balances after a major restructuring, analysts said.

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High Yield Closed-End Funds: Personal Favorites

April 23, 2006
From SeekingAlpha:
 As they say, demographics is destiny. One big theme I have tried to keep in mind is the aging Western population and the need for quality fixed income securities. In this vain, I wrote a while ago about closed-end muni bond funds. Today I’ll discuss some other classes of high yield closed-end funds and highlight, as I always do, several personal holdings.

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Two high-yield funds aim to help hedge risk

April 23, 2006
From InvestmentNews:
 At a time when many financial advisers think that investors should stay away from high-yield bonds because they are too risky, along come two high-yield products that investors can use to hedge some of that risk.

Rydex Investments of Rockville, Md., last Monday launched the Rydex Inverse High Yield Strategy Fund, giving investors the ability to take advantage of rising credit default rates.

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Luis reduces high yield exposure

April 10, 2006
From Investment Week:
 F&C Strategic Bond fund manager Fatima Luis has reduced her high yield exposure to its lowest level in recent years.

Luis has cut high yield exposure to 46%, due to high valuations.

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Fund Times: Pioneer Loses Star High-Yield Manager

April 5, 2006
From Morningstar.com:
 Longtime, highly respected manager Margie Patel resigned on March 30 from Pioneer High Yield. Pioneer replaced Patel with a management team that has had success elsewhere. New manager Andrew Feltus has delivered impressive performance at Pioneer Global High Yield. He is joined by Tracy Wright, who has worked as an analyst of high-yield and distressed companies.

From its inception Patel ran High Yield in a distinctive, and contrarian, value-oriented style. She sought industries with improving prospects and attempted to avoid those corporate sectors that were overly troubled. This analysis led her to avoid in the early 2000s the telecommunications sector, which was a sizable part of the high-yield market before suffering disastrous performance.

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Indonesia, China to lead Asia high-yield debt issues

February 16, 2006
From Daily Times:
 China and Indonesia will produce most high-yield corporate bond issues in Asia this year as their economies expand and yield-hungry investors look to buy riskier assets, a senior banker said on Thursday.

High-yield issues those rated below BBB-minus outperformed high-grade debt in 2006, JPMorgan’s Asia Credit Index shows, with a 9 percent return. High-grade corporate bonds returned 5.2 percent.

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US HIGH YIELD-Yield hunger helps Rite Aid's $1 bln debt sale

February 15, 2006
From Reuters:
 Strong investor demand and limited high-yield bond supply helped the third largest U.S. drug store chain Rite Aid Corp. (RAD.N: Quote, Profile, Research) sell $1 billion of notes on Thursday, 25 percent more than it originally planned.

Rite Aid is using proceeds to refinance older notes and replenish a credit line. The sale comes as Rite Aid prepares to acquire about 1,850 Brooks and Eckerd drug stores to help compete with larger rivals such as Wal-Mart and CVS.

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High-yield issue from China-based GITI Tire prices inside guidance

January 22, 2006
From FinanceAsia.com:
 A last-minute document hitch postpones pricing by 24 hours, but strong demand for the $200 million secured note is unaffected.

The B3/B- senior five-year $200 million secured note from GITI Tire finally priced a day late on January 19 in Hong Kong.

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US HIGH YIELD-Big bankruptcies down, recoveries up

January 22, 2006
From Reuters:
 Big corporate bankruptcies fell to their lowest level in more than a decade in 2006, yet the golden era of scant default risk may be nearing a peak.

Last year, just 14 companies with assets of more than $100 million (in 1980 dollars) filed for bankruptcy protection, down from 25 in 2005 and the fewest since 1994 when there were 11, according to UCLA law professor Lynn LoPucki's Bankruptcy Research Database.

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US HIGH YIELD-Market primed for mega-bond deals

January 11, 2006
From Reuters:
 Massive funding requirements for a global corporate buyout spree will likely spawn record bond sales this year, and the U.S. high-yield market appears primed to take the super-sized deals in stride.

With nearly a dozen potential deals of more than $1 billion in size already in the pipeline, investors and strategists say the high-yield market is now deep enough to bankroll a growing spate of mega-deals.

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Asia High-Yield International Bond Sales To Soar

January 10, 2006
From Egoli.com:
 Junk-grade Asian companies will rush to sell international bonds next year as they seek funds to expand and take advantage of voracious investor appetite for higher returns. "Demand for high-yield, attractive structures and investors' ability to analyze and track these deals has led to an explosion in demand that has catalyzed issuers into coming to this market for financing," said Mark Leahy, head of debt syndication for Asia at Deutsche Bank AG.

Overall sales of bonds denominated in US dollars, yen or euros are set to stagnate next year - most bankers forecast offerings of US$40 billion to US$50 billion from Asia excluding Japan and Australasia - but high-yield corporate bonds will furnish a much larger portion of total issuance than they have in the past.

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UPDATE 1-U.S. high-grade, junk issuance break records

December 29, 2006
From Reuters:
 U.S. high-grade and junk bond issuance rose to record highs in 2006, thanks partly to benign interest rates and surging mergers and acquisitions activity, Thomson Financial said on Friday.

U.S. companies sold $919 billion of high-grade bonds in 2006, up from $672 billion last year, Thomson Financial said.

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Slow 2007 start for European high-yield bond market

December 22, 2006
From MarketWatch:
 Investors absorbed a whopping EUR39 billion of junk bonds from European companies in 2006, and the expectation is that 2007 will be another bumper year.

But with only around EUR6 billion of supply seen coming to market during the first three months of the year, and a decent slug of that expected to come in dollars, 2007 looks set for a languid start. "It's as light as I've seen it for some time," said a high-yield syndicate banker, referring to the forward calendar.

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High-yield bonds down, but not forgotten

November 27, 2006
From TheStar:
 WITH the equity market on a new-found vigour these days, fund managers are hard pressed to make a case for investment in debt market instruments.

The KL Composite Index (KLCI) had returned 16% for the year to Nov 22, 2006. In the 20 trading days since Hari Raya, the KLCI gained an average of 0.32% in a day, better than what the best yielding investment-grade bond can offer in a fortnight.

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US HIGH YIELD-Ford's new debt boosts bondholder risks

November 27, 2006
From Reuters:
 Ford Motor Co.'s new $18 billion financing plan puts the No. 2 U.S. automaker on a different path from rival General Motors Corp., making asset sales less likely as Ford tackles its mounting need for cash.

The new debt package will take advantage of a hot loan market for junk-rated companies and help Ford shore up liquidity and restructure its money-losing North American operations.

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Credit Suisse leads high-yield pack

November 17, 2006
From FinancialNews-US.com:
 High-yield bonds underwritten by Credit Suisse have performed better than rival deals in the secondary market after pricing, according to a study by a US research firm.

Yield premiums on "junk" bonds underwritten by Credit Suisse exceeded the perfomance of the Lehman Brothers US High Yield Corporate Index to a greater degree than those of their competitors during the four weeks after the issues were priced, according research by FridsonVision.

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US high-yield debt rally doesn't price in risk-S&P

November 14, 2006
From Reuters:
 U.S. high-yield corporate debt has rallied in the past few months, even amid heavy new supply, but investors may not be accounting for risks and the market may be susceptible to a sharp correction, Standard & Poor's said on Tuesday.

"With speculative grade spreads tightening by 21 basis points since the end of September to 356 basis points, risk aversion seems like a non-issue, suggesting a fair amount of investor risk tolerance and complacency," S&P said in a report.

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RBS names high-yield head

November 9, 2006
From FinancialNews-US.com:
 The Royal Bank of Scotland has appointed a former head of institutional credit sales at Bank of America to lead a push into the US and European high-yield and distressed debt markets.

RBS has hired David Lofts, who left Bank of America in April 2004 for New York-based middle-market investment bank Jefferies International, after spending five years developing its high-yield business, as head of high-yield and "special situations" sales.

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Africa's Gateway sells $100 mln high-yield bond

November 8, 2006
From Reuters South Africa:
 Gateway Telecommunications Plc, a provider of telephone services in Africa, issued $100 million of high-yield bonds on Tuesday, the first European issue from a pan-African company, the company's president and chief treasurer said.

The deal will allow the company's founders to increase their stake in the business, refinance some existing bank debt and provide funding for expansion, Julian McIntyre told Reuters in a telephone interview.

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Huntsman sells $708 mln of high-yield bonds-source

October 31, 2006
From Reuters:
 Chemicals maker Huntsman Corp. (HUN.N: Quote, Profile, Research) sold a much larger-than-expected $708 million worth of high-yield bonds in dollars and euros on Tuesday, a banking source said.

Huntsman priced a 7-year euro bond, not callable for 3 years, and an 8-year dollar bond, not callable for 4 years, the source said. The deal was originally expected to total $400 million equivalent.

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Insider dealing fears grow over high yield

October 31, 2006
From FinancialNews-US.com:
 Nine out of 10 bankers and investors in the European high-yield market are worried the misuse of private information is fuelling improper trading and market abuse in leveraged loans, credit default swaps and high-yield bonds, according to a survey.

Research by Financial News for the European High Yield Association showed 90% of practitioners are concerned insider trading is escalating because of opacity and poor disclosure in the booming private loan market.

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Treasuries augur downturn but high yield unfazed

October 13, 2006
From Reuters:
 High yield bond investors may be ignoring the U.S. Treasury market's signals of an approaching economic downturn at their peril.

If history is any guide, the Treasury market's omens may be giving advance warning of tougher economic times ahead and the risk of corporate debt defaults.

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Cautious Corner: High yield, low risk proves a winning strategy for Liddle

October 11, 2006
From Citywire:
 Equity exposure through high-yielding value stocks with no overseas equity exposure or UK growth holdings is key to Sam Liddle’s strategy for his CF Miton Extra Income portfolio.

But that is not to say Liddle shies away from asset classes that many fund of fund managers avoid. He currently holds close to 25% of his portfolio in structured products and another 23% in investment trusts.

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The Junk Stops Here

October 8, 2006
From Barron's Online:
 "ONE MAN'S JUNK IS ANOTHER MAN'S TREASURE," goes the old saw. But, sometimes, junk is just, well, junk.

That's the danger for the speculative-grade corporate-bond market, which has enjoyed a spectacular run since bottoming in October 2002 after the tech bubble burst. Since then, it's produced a cumulative total return of 69%. Its resiliency has been astonishing. Just last spring, the market ground to a halt amid concern that the Fed might choke economic growth by tightening monetary supply too aggressively, and many feared the worst. But an impressive run from July to September produced a total return of 4.4%, ...

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Philips sets high-yield record

October 5, 2006
From eFinancialNews.com:
 The four private equity firms which paid €8bn ($10.1bn) to buy Philips' semiconductors business in August have launched Europe’s largest high-yield bond to help finance the deal.

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High yield returns to former glory

October 2, 2006
From eFinancialNews.com:
 Europe’s high-yield market was believed to be in its death throes four years ago. New issuance slowed in 2002 to just over €5bn ($6.4bn), down from almost €15bn in 2000 and €8.4bn in 2001.

But, since 2003, the market has clawed its way back and Europe’s biggest high-yield bond issue this week from NXP, the former semiconductor business of Philips Electronics, will test how far it has come.

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O-I to Present at Deutsche Bank 2006 High Yield Conference

October 2, 2006
From Yahoo! Finance:
 Owens-Illinois, Inc. (NYSE: OI - News) today announced that it will participate in the Deutsche Bank 2006 High Yield Conference to be held October 3-5 in Scottsdale, Arizona.

O-I senior vice president and CFO, Ed White, will give a formal presentation on Wednesday, October 4, at 12:55 p.m. ET.

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European high-yield debt

September 25, 2006
From Euro2Day:
 "Only the fit companies will survive". NXP – the semiconductors business of Philips bought by private equity – pulled no punches in a presentation to chip-watchers earlier this year. The phrase may be trite, as was the accompanying picture of lions mauling some unfortunate herbivore. But NXP's upfront assessment of industry conditions, while it embarks on Europe's biggest-ever high-yield bond offering, says much about the current state of the credit market.

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Surprising Performance From High-Yield Bonds

September 19, 2006
From Kiplinger's:
 Early in 2006, you couldn't find many positive prognostications about junk bonds. That includes in this space. I wasn't at all keen on junk bonds -- also known as high-yielding corporate bonds. My arguments for ignoring the category -- or at least not adding new money to it -- seemed logical. They included low yields relative to high-quality bonds, signs of a slowing economy, and better alternatives, such as energy pass-through securities and real estate investment trusts. The prospects of a weaker economy, in particular, affected my thinking. That's because slow growth or worse -- declining economic activity -- normally portends more bond defaults and rating downgrades.

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Pacholder High Yield Fund Announces Monthly Dividend

September 13, 2006
From BusinessWire:
 The Pacholder High Yield Fund, Inc. (AMEX:PHF) declared a regular monthly dividend of $0.075 per common share for the month ending September 30, 2006. The dividend will be payable on October 10, 2006 to shareholders of record on September 29, 2006. The ex-date for the dividend is September 27, 2006.

The Fund is a closed-end diversified management investment company with a leveraged capital structure. The Fund's investment objective is to provide a high level of total return through current income and capital appreciation. Under normal circumstances, the Fund invests at least 80% of the value of its assets in high yield securities. The Fund invests primarily in fixed income securities of domestic companies. The Fund's common stock is traded on the American Stock Exchange under the symbol "PHF."

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Assets Way Up in High-Yield Muni Market

September 1, 2006
From OnWallStreet.com:
 What has come over municipal bond funds? Traditional muni funds have long been a boring safe haven for retirees living off their nest eggs. High-yield muni bond funds, on the other hand, have knocked the cover off the ball for the past three years--and investors have taken notice.

According to Morningstar, assets in high-yield muni funds jumped to $41.6 billion in March of this year--more than double their size of $20.4 billion in March 2003. Net inflows rose from $2.66 billion in 2004 to $7.84 billion in 2005 and have maintained that pace this year, hitting $3.63 billion by May 31.

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Asian High-Yield Bonds Post Gains

August 30, 2006
From All Headline News:
 Asian high-yield bonds and the Philippine sovereign dollar credits post gains on Wednesday after news of the Federal Reserve meeting show the U.S. central bank will not be making new interest rates hike.

A report by Reuters also showed high-grade bonds were mostly steady on Wednesday's trading.

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Lack of UK high-yield issues forces funds overseas

August 21, 2006
From Investment Week:
 Declining numbers of sterling junk bond issues, to just 38, has forced the majority of high-yield funds in the UK Other Bond sector to buy overseas credit and hedge back into sterling.

The remit for the UK Other Bonds sector demands that funds must have 80% of their assets either in sterling or hedged back into the currency.

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FUND VIEW-Threadneedle cuts high-yield debt weighting

August 9, 2006
From Reuters Italia:
 Threadneedle Investments said on Tuesday it has cut exposure to high-yield debt, taking profits on a recent strong performance by such bonds, while it held other asset allocations steady.

"We have become more cautious of high yield bonds, preferring an underweight position," the company's chief investment officer, Sarah Arkle, said in a note.

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Pimco Starts Fund to Buy High-Yield, High-Risk Municipal Bonds

August 1, 2006
From Bloomberg:
 Pacific Investment Management Co., the manager of the world's biggest bond fund, formed a fund to invest in high-yield, high-risk municipal debt.

The Pimco High Yield Municipal Bond Fund began accepting investor money today. Pimco started the fund with $3 million of company money.

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Megaworld steps up with new high-yield debt deal

July 31, 2006
From FinanceAsia.com:
 Philippine real estate developer Megaworld on Friday (July 28) became the first high-yield issuer to take advantage of the positive sentiment left in the wake of last week’s hugely successful Philippine sovereign deal, pricing an un-rated $100 million Reg-S, five-year bond offering in line with guidance.

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A high-yield combination

July 26, 2006
From Reuters.com Investment Channel:
 Suggest to investors the prospect of a 9-plus percent yield for a one- or two-year note and they may reflexively think "distress credit." Nowadays, however, some major brokerage firms and their retail clients have another phrase: "structured notes," or instruments that combine elements of notes, stocks, and options.

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Citi adds new high yield mandate to its DCM pipeline

July 14, 2006
From FinanceAsia.com:
 Property holdings special purpose vehicle (SPV) Noble Finance BV has awarded Citigroup the mandate for a proposed dollar denominated Reg-S/144a high-yield bond offering. Citigroup will act as sole bookrunner, as well as joint lead manager with PT Batavia Prosperindo Sekuritas.

This deal should not be confused with the similarly named Noble Group, listed in Singapore. In March of 2005, Noble, a commodity trading company, launched a $700 million Ba1/BB+ bond deal via sole bookrunner JPMorgan.

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STOCKS NEWS EUROPE-High-yield bond investors cut positions - JPM

July 10, 2006
From Reuters:
 High-yield bond investors have cut their positions in the last two months, according to a survey of investors by JPMorgan, although 50 percent of respondents continue to hold long positions.

The proportion of investors holding short positions relative to benchmark indexes rose to 37 percent on July 7 from 14 percent on May 4, JPMorgan says.

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Rexnord, parent set $840M high-yield offering

July 6, 2006
From The Milwaukee Business Journal:
 RBS Global Inc. and its subsidiary, Rexnord Corp., announced Wednesday their intent to offer $420 million principal amount of senior notes due 2014 and $420 million principal amount of senior subordinated notes due 2016 in a private placement.

The proceeds of the offering, together with an equity investment by an affiliate of Apollo Management L.P., New York, and borrowings under new senior secured credit facilities, will be used to finance Apollo's purchase of RBS Global from The Carlyle Group, Washington, D.C., for $1.825 billion, as announced May 25.

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Direxion Funds Names High Yield Manager

June 28, 2006
From MSN Money:
 Direxion Funds, a mutual fund company formerly known as Potomac Funds, on Wednesday named Loren Norton portfolio manager for its Dynamic High Yield Bond Fund, VP Dynamic High Yield Bond Fund and High Yield Bear Fund.

Norton joins Direxion from Credit Suisse as the company switches subadvisors. Rafferty Asset Management will manage the high yield funds as of July 1, replacing Transamerica Investment Management LLC, which had run the funds with multiple managers since their inception.

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High-yield bond defaults tumble

June 14, 2006
From Financial Times:
 The sell-off of high-yield bonds over the last four weeks happened as the asset class experienced the lowest default rate in more than 20 years, data from Standard & Poor’s showed on Wednesday.

The credit rating agency said the global default rate for speculative grade-rated bonds was 1.09 per cent in May, the same as in the previous month and the lowest in more than 20 years.

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Managed High Yield Plus Fund Inc. -- Dividend Declaration and Updated Price & Yield Information
June 12, 2006
From BusinessWire:
 Managed High Yield Plus Fund Inc. (NYSE: HYF), a closed-end management investment company, today announced that the Fund's Board of Directors has declared a dividend from net investment income of $0.0450 per share. The dividend is payable on June 30, 2006 to shareholders of record as of June 22, 2006. The ex-dividend date is June 20, 2006. Managed High Yield Plus Fund Inc. seeks high income and, secondarily, capital appreciation, primarily through investments in lower-rated, income producing debt and related equity securities.

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Pacholder High Yield Fund Announces Monthly Dividend

June 12, 2006
From PR Newswire:
 The Pacholder High Yield Fund, Inc. (Amex: PHF) declared a regular monthly dividend of $0.075 per common share for the month ending June 30, 2006. The dividend will be payable on July 10, 2006 to shareholders of record on June 30, 2006. The ex-date for the dividend is June 28, 2006.

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State Street Expands Relationship with Calamos Investments(R) to Service an Additional $29.8 Billion In Assets

June 12, 2006
From BusinessWire:
 State Street Corporation (NYSE: STT), the world's leading provider of financial services to institutional investors, announced today that it has expanded its relationship with Illinois-based Calamos Investments(R) (Calamos) to provide fund accounting services for nine open-end mutual funds and one variable insurance fund representing nearly $29.8 billion in assets at April 30, 2006. State Street now provides services for 14 of Calamos' funds representing approximately $36 billion in assets at April 30, 2006.

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Treasury auctions 10-year notes at 5.14% high yield

May 11, 2006
From MarketWatch:
 The Treasury Department auctioned $13 billion of 10-year notes Thursday at a high bid of 5.14%, the highest yield since May 2001. Bids totaled 2.53 times the offering amount, above the 2.30 average. The median yield was 5.117%, the Treasury said. Indirect bids were awarded $3.95 billion of the notes, 30.7% of the offering. The auction was "decent and relatively in line with expectations," said analysts at Action Economics. "The results are good enough to support Treasuries into the close."

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Pacholder High Yield Fund Announces Monthly Dividend

May 10, 2006
From Yahoo! Finance:
 The Pacholder High Yield Fund, Inc. (Amex: PHF - News) declared a regular monthly dividend of $0.075 per common share for the month ending May 31, 2006. The dividend will be payable on June 9, 2006 to shareholders of record on May 31, 2006. The ex-date for the dividend is May 26, 2006.

The Fund is a closed-end diversified management investment company with a leveraged capital structure. The Fund's investment objective is to provide a high level of total return through current income and capital appreciation. Under normal circumstances, the Fund invests at least 80% of the value of its assets in high yield securities. The Fund invests primarily in fixed income securities of domestic companies. The Fund's common stock is traded on the American Stock Exchange under the symbol "PHF."

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IPE-QUEST: Nordic insurer in high-yield RFI

May 8, 2006
From Yahoo! Finance:
 A Nordic insurance company has issued a request for information (RFI) for global high-yield debt via IPE-Quest.

The search (QN623) says: “If you do not offer a separate account for global high yield bonds, please provide information for your pooled fund product.

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European high yield bonds come back to life

April 18, 2006
From Financial Times:
 The European high-yield bond market is coming to life after the holiday lull as new issues worth more than €3.5bn wait in the pipeline.

TDC, the Danish telecoms operator, will on Wednesday start the marketing of its forthcoming high-yield bond issue. The company is issuing bonds to refinance a €2.3bn bridge loan from last year's leveraged buyout by a consortium of private equity companies.

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High Yield Isn't Always High Risk

March 13, 2006
From The Motley Fool:
 Sell in May and walk away. Buy the rumor and sell the news. The trend is your friend. Don't chase high-yielding stocks. All these stock market rules of thumb are meant to save time for investors like you. But often, the companies that offer the best returns get ignored because they violate one of these rules.

As an investor with a focus on dividends, "Don't chase high-yielding stocks" is particularly close to my heart. In theory, a high yield screams high risk. In practice, a high yield can also mean slow growth prospects or a company misunderstood by the market.

A high yield often accurately portrays higher risk; that's certainly the case with Pier 1 Imports (NYSE: PIR), whose yield has been bouncing around the 4% to 5% range. Pier 1 has a balance sheet with plenty of cash, but it also generates nearly all of its free cash flow in its fourth quarter, and the first three quarters of this fiscal year have been nothing to crow about.

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Junk bonds lose sparkle

March 13, 2006
From The Beacon Journal:
 Holders of junk bonds, take note. This may be the year you learn why high-yield bonds are called "junk.''

Even fund managers who rode junk bonds' fat total returns over the past three years are uneasy. Earl McEvoy, manager of the $9 billion Vanguard High-Yield Corporate fund, believes that junk bond returns won't match those of even money-market funds. He's moving money into higher-quality junk bonds, which should suffer less in a general decline.

The problem with junk bonds starts with their prices. Interest and capital appreciation combined to deliver annualized 13 percent returns the past three years. So they are hardly cheap. As bond prices have appreciated, yields have declined.

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Looking for Yield in All the Right Places

March 13, 2006
From TheStreet.com:
 It's not easy finding yield. Unless, that is, you know where to look.

The last few years have been difficult for high-yield fund managers. A global economic recovery and underwhelming inflation have made it tough to find decent paper with a steady payout. As a result, the average high-yield fund has only returned 11.2% per year since 2003, according to fund-tracker Morningstar. That's not necessarily a jaw-dropping return for one of the market's riskier asset classes.

Despite the slim pickings, Andrew Feltus, portfolio manager for the $845 million Pioneer Global High Yield fund (PGHYX), has been successful in spotting value, especially in emerging markets. His fund has returned an average 16.85% annually over the past three years, putting it in the top 2% of all funds in its Morningstar category. Furthermore, his fund is yielding 7.3%, which Morningstar says is over 40 basis points more than the average high-yield fund payout.

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The Manitowoc Company to Present at Lehman Brothers High-Yield Conference

March 13, 2006
From Yahoo! Finance:
 The Manitowoc Company, Inc. (NYSE: MTW - News) today announced that it will participate in the Lehman Brothers High-Yield Bond and Syndicated Loan Conference, which will be held at the Disney Yacht & Beach Club Resort from March 15 through March 17, 2006. Terry Growcock, chairman and chief executive officer, and Carl Laurino, senior vice president and chief financial officer, are scheduled to present an update on the company's strategy and growth initiatives on Thursday, March 16, at 10:10 a.m., Eastern time.

A live audio webcast of Manitowoc's presentation will be available through the company's website at http://www.manitowoc.com . To access the webcast, investors should go to the company's website 15 minutes prior to the start of the presentation.

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Macquarie: SUN - High Yield... A Two Day Dividend Buying Opportunity

February 27, 2006
From egoli:
 SUN announced its first half 2006 profit on Friday of $454m. The result was up 2.9% from the company’s previous corresponding period and ahead of Macquarie Research Equities (MRE)’s forecast of $445m. The company also announced a fully franked dividend of 47cps, which means that the stock is currently trading on a dividend yield of approximately 4.5% fully franked. The stock is due to go ex-dividend in 2 days on 1st March, so if you are looking for dividend yield opportunities over a quality, diversified financial stock, then you have today and tomorrow to buy SUN in order to be entitled to the 47 cent dividend.

At a divisional level, the banking division increased its pre-tax contribution by 16.4% to $255m. General Insurance (GI) delivered a pre-tax profit of $330m, down 4.1% compared to $344m on pcp. Wealth management contributed $42m pretax, compared to $41m pcp.

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Risk and high-yield junk bonds

February 27, 2006
From Delaware Online:
 Let's think about a little number: 4.59 percent. It's the interest you can earn annually on a 10-year Treasury note. That would be $45.90 a year on a $1,000 investment.

Normally, if you're looking for a bit of extra yield, you can buy a longer-term bond. If a two-year T-note's yield is too low, for example, you can usually get more interest from a 10-year T-note.

But we're not living in normal times. A two-year T-note yields 4.69 percent, slightly more than the 10-year T-note. Buying longer-term bonds lowers your yield.
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You can, however, boost your returns by investing in less creditworthy bonds. Bonds are long-term, interest-bearing IOUs. Securities issued by the Treasury are considered virtually risk-free, because the U.S. government can raise taxes, print more money, or both.
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FOCUS: High-Yield Forex Jitters Point To Mkt Shift Risk

February 24, 2006
From Yahoo! Finance Singapore:
 After the bull run that high-yielding currencies had in 2005, predicting the end of the high-yield heyday has become one of currency analysts' favorite tricks.

But signs of a real unwinding of the so-called carry trade have gained strength in recent days and weeks, hinting that the currency markets could be on the verge of something big.

First there was the now-familiar dump of New Zealand dollars. Then there was this week's spectacular crash in the super-high-yielding Icelandic krona. And with talk of Japanese tightening gathering steam, some analysts are warning market participants against complacency in the weeks ahead.

"Once we do see a wholesale position unwinding, it has the potential to be quite a sharp move," said Ian Stannard, a currency strategist at BNP Paribas in London.

"And if we look back at previous unwindings of positions, especially with the yen, the markets do have a tendency to move quickly." 

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CC Euro high yield focus pays double dividend

February 23, 2006
From Legal Week Global Edition:
 Clifford Chance (CC) has this month closed two European high yield deals worth more than €200m (£137m) each.

The first deal saw the magic circle firm’s US securities group head in London, John Connolly, advise Spanish cable giant Cableuropa on its recent €270m (£185m) issue. In the US, CC associate Greg Nardini and Madrid finance partner Carlo Hernandez-Canut also advised. The issue of the high yield bonds allowed Cableuropa to acquire the cable assets of Spanish company Auna.

CC has acted for Cableuropa since it was created in 1999 to purchase cable licences in Spain, including advising on financings between 1999 and 2004 as the company expanded its network. Cableuropa now holds 85% of Spain’s cable assets. 

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Morgan Stanley High Yield Fund, Inc. Declares Monthly Income Dividend

February 17, 2006
From BusinessWire:
 Morgan Stanley High Yield Fund, Inc. (NYSE: MSY) today declared a monthly dividend of $0.0350 per share of net investment income.

RECORD DATE    PAYABLE DATE
-------------         -------------
02/28/06            3/15/06

Morgan Stanley High Yield Fund, Inc. (the "Fund"), advised by Morgan Stanley Investment Management Inc., is a closed-end management investment company investing principally in debt securities rated below investment grade or are unrated and considered to have a credit quality below investment grade.

The Fund's primary investment objective is to seek high current income and its secondary objective is to seek capital appreciation.  

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A Guide to High-Yield, High-Risk Stocks

February 15, 2006
From DailyIndia.com:
 The classic image of the stock market is that of a place where fortunes are made and lost throughout the course of the day, and where those who take the biggest risks are rewarded by a hefty payout when all is said and done. Of course, this is the movie version of the market… no matter how thrilling the day-to-day dramas of investment trading become, they'll never compete with the images of the stock market that have been created for the silver screen.

There is a small grain of truth to those images from the movies, however… those individuals who choose to deal in high-risk stocks can make a lot of money if they handle the risks correctly. If they don't, however, then there's a good chance that they could lose their entire investment.

Below you'll find more information on the world of high-risk (and high-yield) investments, including ways to help insure yourself against major losses when dealing with higher levels of investment risk. 

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Fifth Third launches high-yield bond fund

February 1, 2006
From The Cincinnati Business Courier:
 Fifth Third Bancorp has added another mutual fund to its arsenal with the launch of its Fifth Third High Yield Bond Fund.

The fund invests in bonds that are rated below investment-grade, meaning they're rated BB or lower. It aims to provide investors with a high level of income as well as possible capital appreciation.

"Research shows that adding high-yield bonds to a diversified portfolio has the potential to increase return and reduce risk over the long term," said Keith Wirtz, president and chief investment officer of Fifth Third Asset Management Inc., the fund's adviser.

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Latham high-yield star in Silverpoint shift

January 30, 2006
From The Lawyer.com:
 Latham & Watkins has lost one of the stars of its high-yield practice to hedge fund Silverpoint Capital as the European market fails to sustain the volume to allow Latham's UK team to replicate the success of its colleagues in the US.

Partner Gay Bronson has joined Silverpoint as its first in-house counsel in London. Silverpoint is a US hedge fund specialising in rescue financing and is also a client of Latham.

The departure leaves Latham with four London partners working in the high-yield arena, including Rich Trobman and Bryant Edwards, who acted for the banks in the €Â‚¬12bn (£8.21bn) Wind high-yield bond.

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Savcio plans 115 mln euro high-yield bond - lead

January 30, 2006
From Reuters South Africa:
 South Africa's Savcio Holdings, a maintenance and repairs group, plans to sell a 115 million euro, 7-year high-yield bond after a European roadshow, the bank managing the deal said on Monday.

The senior secured notes, which will be non-callable for four years, will be sold after investor roadshows from January 31 to February 6, Barclays Capital said.

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Asia Benchmark Bonds Tighten, Led By High-Yield Bonds

January 27, 2006
From Yahoo! Finance Singapore:
 Investor demand for U.S. dollar-denominated Asian high-yield credits is set to continue, even after a strong week for the sector bolstered by a very well-received bond deal.

"There's a fair bit of momentum for high yield. That's going to be where the action is for the next few weeks," said Lloyd Ong, credit analyst at BNP Paribas in Hong Kong.

Credit spreads over U.S. Treasurys on the sub-investment-grade portion of the JPMorgan Asia Credit Index tightened almost 10 basis points to 271.2 basis points as of the Thursday close in Asia. Spreads for the index as a whole tightened 3.5 basis points to 129.2 basis points. The JACI tracks liquid U.S. dollar bonds from Asian issuers, weighted for market capitalization.

Ong noted that investors are piling into the high-yield sector mostly because of the attractive yields it offers compared with investment-grade bonds, and not for fundamental reasons.

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DDJ High Yield Fund announces change in distributions

January 26, 2006
From CNW Group:
 DDJ High Yield Fund (the "Fund") today announced a change in its distribution policy. Effective March 2006, the Fund's quarterly distribution will be changed to $0.30 per unit from $0.60 per unit.

"This change will ensure that the Fund's distributions are more consistent with the expected yield of the Fund's investments, as a significant portion of past distributions have been in the form of return of capital and, therefore, have caused the erosion of the Fund's NAV," said David R. McBain, Senior Vice-President of CI Investments Inc., which is the manager of the Fund.

The move follows a change in the Fund's investment strategy approved by unitholders in October 2005 that allows it to invest in high-yield debt securities on a global basis. Previously, the Fund had been restricted to investing primarily in high-yield debt securities issued by Canadian corporations and to holding no more than 30% of the Fund in foreign property on a cost basis.

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Asia's Junk-Bond Gain Forces Investors to Safer High-Yield Debt

January 20, 2006
From Bloomberg:
 Asian junk bonds returned four times as much as the region's investment-grade debt last year as record low yields sent investors toward riskier bets. This year, people seeking to extend their gains may have to pick the safest of the lowest-rated securities.

Desmond Soon, who manages about $200 million of debt at Pacific Asset Management in Singapore, said he will buy more high-risk, high-yield government bonds or those sold by state- owned companies in the Philippines, Indonesia or Vietnam. He now owns debt from the governments of Vietnam and the Philippines.

It's a bet other investors are making as well by turning to sovereign debt rated below investment grade and securities from companies with the highest junk ratings. The Philippines, whose bonds were the world's best performers in 2005, is rated BB-, three notches below investment level, by Standard & Poor's. Yields for the riskiest bonds aren't high enough to compensate for the chance companies will default on their debt, he said.

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CIM High Yield Securities Announces Liquidation

January 20, 2006
From Business Wire:
 CIM High Yield Securities (the "Fund") (AMEX:CIM) today announced that shareholders of the Fund have approved the proposal to liquidate the Fund.

In accordance with the Plan of Liquidation approved by shareholders, the transfer agent books of the Fund will be closed at the close of business on February 3, 2006 and as of that time the Fund will cease its business activities except as provided in the Plan. At that time, shareholders' respective interests in the Fund's assets will be fixed and will not be transferable and the Fund's shares will cease to be traded on the American Stock Exchange.

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Morgan Stanley High Yield Fund, Inc. Declares Monthly Income Dividend

January 20, 2006
From Business Wire:
Morgan Stanley High Yield Fund, Inc. (NYSE: MSY) today declared a monthly dividend of $0.0350 per share of net investment income.

RECORD DATE      PAYABLE DATE
01/31/06              2/15/06

Morgan Stanley High Yield Fund, Inc. (the "Fund"), advised by Morgan Stanley Investment Management Inc., is a closed-end management investment company investing principally in debt securities rated below investment grade or are unrated and considered to have a credit quality below investment grade.

The Fund's primary investment objective is to seek high current income and its secondary objective is to seek capital appreciation.

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High Yield Isn't Always High Risk

January 13, 2006
From The Motley Fool:
Investors who assume all high-yielding stocks carry with them higher levels of risk are shutting themselves out of profitable investment opportunities. The opposite is true as well. Low-yielding opportunities do not always mean a safe dividend payment for years to come.

Sell in May and walk away. Buy the rumor and sell the news. The trend is your friend. Don't chase high-yielding stocks. All stock market rules of thumb meant to save you, the investor, time. But often the companies that offer the best returns get ignored because they violate one of these rules.

As an investor with a focus on dividends, "Don't chase high-yielding stocks" is particularly close to my heart. In theory, a high yield screams high risk. In practice, a high yield can also mean slow growth prospects or simply that a company is being misunderstood by the market.

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Fitch Downgrades 2 Classes of PPM High Yield CBO

January 10, 2006
From Business Wire:
Fitch Ratings downgrades two classes of notes issued by PPM High Yield CBO I Company Ltd. (PPM High Yield CBO I). The following rating actions are effective immediately:

-- $93,662,465 class A-1 notes downgraded to 'B' from 'BB';

-- $22,000,000 class A-2 accreting notes affirmed at 'AAA';

-- $55,700,000 class A-3 notes downgraded to 'C' from 'CC';

-- $73,100,000 class B notes remain at 'C'.

PPM High Yield CBO I is a collateralized bond obligation (CBO) managed by PPM America. PPM High Yield CBO I closed on March 2, 1999. The notes are supported by a portfolio primarily consisting of high-yield corporate bonds.

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Hit the High-Yield Jackpot

January 6, 2006
From The Motley Fool:
 Stocks with high dividend yields can do wonders for a portfolio. If you buy shares of a company that pays 6%, 8%, or even 10% annually and get a capital gain, you're pretty much assured of beating the market.

The problem is that high yields also tend to be unreliable.

High-yield headaches
High-yield stocks are only worthwhile when investors receive the advertised return. As valuation luminary Aswath Damodaran told Fool co-founder Tom Gardner in a recent interview, "High dividend-yield stocks are [only] attractive if you can expect the company to keep paying those dividends."

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New Star launches Euro high yield fund

January 4, 2006
From Business Today:
New Star International has recently announced the launch of the New Star Euro High Yield Fund, a sub-fund of New Star Global Investment Funds PLC, a Dublin-based OEIC, in Malta through their local representative, Jesmond Mizzi Financial Services Limited.

The fund will be managed by James Gledhill, Head of Fixed Income (Credit) at New Star and currently rated “AAA” by Citywire.

The New Star corporate bond team, headed up by Theo Zemek and James Gledhill, has one of the longest and most successful track records within the high yield sector in the UK and Europe.

The New Star Euro High Yield Fund aims to achieve a high level of income with the potential for modest long-term capital appreciation. It is aimed at cautious investors wishing to protect capital and benefit from a high level of income. The portfolio gross redemption yield per annum is estimated at about 5.71% and the portfolio gross income yield per annum is estimated at about 6.57 % (as at 30th November 2005). The New Star Euro High Yield Fund is a natural addition to the Dublin OEIC’s range of funds, which are aimed at investors seeking greater portfolio diversification.

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Drew Fung Joins RREEF as Head of High Yield Debt Investments

January 3, 2006
From Finanzen.net:
RREEF announced that Drew Fung has joined the firm asHead of US High Yield Debt Investments, based in New York. Theannouncement was made by Christopher Hughes, Head of Global RealEstate Securitized Products.

Fung will lead and expand the existing team which will specializein providing investment options in a wide variety of structured debtinvestments including mezzanine, B-notes, preferred equity and bridgeloans. His previous position was overseeing subordinate debtproduction at CWCapital, and prior to that he was with Lend Lease.

Thanh Bui also has joined the team as a Vice President, reportingto Fung. Based in New York, she will help lead origination andproduction efforts for the group. Prior to joining RREEF, Bui was withCWCapital where she was responsible for originating, structuring andunderwriting high yield debt investments.

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Fitch Ratings to Launch Reformatted 'High Yield Market Weekly' Each Friday

January 3, 2006
From Business Wire:
Fitch Ratings will issue a newly reformatted version of its 'High Yield Market Weekly' newsletter beginning Friday, Jan. 6, 2006. The newsletter, previously issued each Monday morning, will now be issued on Friday afternoons in order to provide important high yield information and key commentary on a more timely basis to high yield portfolio managers and analysts.

Fitch's newsletter will continue to contain high yield market data including market commentary, high yield index information, daily trade volume, top price movers, a forward high yield calendar, recently priced issues, and a forward economic calendar. Fitch currently rates approximately 80 of the top 100 high yield issuers in the U.S. Approximately one-third of corporate issuers rated by Fitch in the U.S. are rated below investment grade.

In addition to these features, the new version will include a reformatted front page that more clearly reflects newsletter content, a table of all Fitch high yield research reports issued in the previous month, and even more forward-looking weekly commentary. Future additions could include European high yield commentary as well as research summaries of European high yield companies.

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Northwest High Yield Bond Trust files preliminary prospectus

January 3, 2006
From CNW Group:
Northwest Mutual Funds Inc. (the "Manager" or "Northwest") is pleased to announce that it has filed a preliminary prospectus dated December 22, 2005 for the initial public offering of units (the "Units") of Northwest High Yield Bond Trust (the "Trust").

The Trust is a closed-end investment trust whose investment objectives are: (i) to provide holders of Units ("Unitholders") with monthly distributions; (ii) to enhance the long-term total return within the Trust's portfolio; and (iii) to return to Unitholders upon the termination of the Trust at least the original issue price ($10.00 per Unit) of the Units.

AmerUs Capital Management Group Inc. ("AmerUs") will be the sub-advisor for the Trust. The Trust will invest in an actively managed portfolio consisting primarily of U.S. high yield debt securities.

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National Coal Corp. Completes $55 Million High Yield Debt Offering

December 30, 2006
From Business Wire:
National Coal Corp. (Nasdaq: NCOC), a Central Appalachian coal producer, has completed a $55 million high yield debt offering of notes bearing 10.5% interest due in 2010, and common stock purchase warrants.

The offering is the Company's largest and most significant financing transaction, and will provide working capital to support the Company's business plan which has, in the past, relied heavily on the development of undeveloped reserves acquired in Kentucky and Tennessee. This strategy has worked well for National Coal, as evidenced by the Company's sequential quarterly growth since its inception in 2003.

In 2004, the Company raised approximately $38 million through the sale of debt and equity securities and under its credit facility, the proceeds of which were used to fuel the Company's acquisitions and operational improvements. Jon Nix, President, CEO and Chairman of the Board for National Coal, expects the proceeds of the offering will generate similar growth. "Our 2004 financing transactions strengthened the Company's balance sheet and created opportunities by optimizing the value of our assets. I am confident the proceeds of this offering will produce similar results," said Mr. Nix.