Bond Funds Post 3rd Week of Outflows
U.S-based high-yield bond funds reported $1.2 billion in outflows, while U.S.-based investment-grade corporate bond funds posted their biggest cash withdrawals since June 2013, at $1.8 billion, data from Thomson Reuters' Lipper service showed on Thursday. The latest figures, for the week ended Aug. 12, mark the third straight week of outflows for the two fund categories, Lipper said. "The flows data indicated investors were running away from high yield in both mutual funds and ETFs," said Pat Keon, research analyst at Lipper.
Reader Jerome who emailed the above link also noted rising spreads in corporate bonds. Here are some charts and a table that highlight what's happening.
AA vs. BBB vs. BB Junk Bond Yields
CCC vs. BB
CCC Minus BB
CCC Minus BB Detail
Comparison of Yields and Spreads on Select Dates
| Date | AA Yield | BBB Yield | BB Yield | CCC Yield | BBB-AA Spread | BB-AA Spread | BB-BBB Spread | CCC-BB Spread |
|---|---|---|---|---|---|---|---|---|
| 6/30/2014 | 2.41 | 3.42 | 4.30 | 8.00 | 1.01 | 1.89 | 0.88 | 3.70 |
| 4/27/2015 | 2.25 | 3.39 | 4.50 | 8.72 | 1.14 | 2.25 | 1.11 | 4.22 |
| 8/13/2015 | 2.72 | 4.01 | 5.47 | 16.18 | 1.29 | 2.75 | 1.46 | 10.71 |