Junk Bond Risks – Speculative Investments – Arbitration

Many companies have borrowed to buy back shares, or pay dividends.

Since the financial crisis, there have been a surge in the issuance of junk bond debt.

In addition, there are exchange traded funds which actively buy and trade junk bonds.  Often, the funds have fancy names such as “High Yield Bond Fund” or “High Interest Rate Bond Fund.”    With the higher interest rates on the bonds comes a higher risk.

By definition, junk bonds have a much higher risk of default than treasury bonds, or high quality corporate bonds.

It is 2018 and we are near the end of an expansionary business cycle.  Nobody knows when the cycle will end.   The only thing an investor can do is reduce risk of loss, by reducing or eliminating holdings in below investment grade bonds.

Junk bonds have two risks.   A bonds price can go down as interest rates go up.  In addition, a corporation issuing a bond can default on its debt, causing a partial or total loss of principal.

In you have been lead into a poor investment in junk bonds, and have suffered a loss from an investment advisor or broker’s advice,  please feel free to contact Attorney Singer  Attorney Singer would be happy to discuss with you your rights, including any right to arbitration.

Attorney Robert M. Singer

2572 Whitney Avenue

Hamden, CT  06518




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