Junk Bond Spreads Accelerating Higher – Not Good for StocksAugust 01, 2014
Earlier this week as asked what junk bonds know that stocks don’t. Since then junk spreads to the 10-year US Treasury bond have widened another 20bps as they have accelerated higher. Given the 88% correlation with stocks over the last year, this is something that we will continue to closely monitor.
Aug 2013-Jul 2014: