There Are Junk Bonds and Then There’re Really Junk Bonds

The media periodically gets nervous about the use of junk bonds, those that have less than prime quality. But then you can buy a bond that’s not so prime, among the top B ratings, and the much more risky types among the C or lower ratings. There is a difference that the media headlines usually never differentiate.

Moreover, the media, in their frenzy, will hardly ever explain that the risk in terms of potential default is usually built into the higher yields you get. Furthermore, the purchase you make can be diversified in low-cost mutual funds with an eye on duration principles.(See the Earl J. Weinreb NewsHole® comments and @BusinesNewshole at Twitter.)