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MarketScape · 03.04.24

How Falling Interest Rates, Better Fundamentals May Support U.S. High Yield

The U.S. economy may slow this year and interest rates may fall, making high yield bonds a potentially attractive investment. Learn why.
  • Fixed Income Insights
  • Volatility & Risk
  • High Yield
  • Market & Investment Trends
Key Points
What it is
We explain why U.S. high yield bonds appear an attractive investment now.
Why it matters
U.S. economic uncertainty could spark volatility in the equity market, increasing the importance of diversification.
Where it's going
With attractive yields and the potential for price appreciation, high yield bonds may help investors manage portfolio risk.
Main Point

High Yield Bonds for Managing Risk

With the potential for a U.S. economic slowdown, we think investors face economic uncertainty that could spark volatility in the equity market. To potentially soften equity volatility, we think investors could consider allocating to high yield bonds, which may provide resilience because of improved fundamentals.

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