Investors Continue to Avoid High-Yield Bonds Despite New Cash Infusion
The European Central Bank announced a new $1.1 trillion euro bond-buying program last week. The goal of the new program was to push investors back into the market to buy risky corporate debt. However investors have pulled out $523 million from global high-yield bond mutual and exchange-traded funds and withdrew $868 million from funds that buy U.S. speculative-grade loans.
It’s still uncertain whether Individual investors are leaving a seemingly untiring party in risky debt too early, or whether their sentiment is a harbinger of a deeper, more worrisome idea: that bond-buying programs used to ignite growth are not so well anymore.
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