- Following a challenging 2015, high yield bonds enjoyed a healthy bounce back in 2016, generating returns of approximately 17.5%.1
- On the heels of such a strong total return, it is important to note that high yield bonds have, at times, turned in solid encore performances in the calendar year immediately after they generated double-digit total returns.
- High yield bonds have returned 10% or more in 14 of the 30 years since the Bank of America Merrill Lynch U.S. High Yield Master II Index’s inception in 1986.1 In four cases, they generated double-digit returns for two or more consecutive years.1
- Returns on high yield bonds have varied greatly in the year following a double-digit return, from approximately 2.3% to 17.4%. Yet their average total return the first year after a 10%-plus return is approximately 9.5%.1
1 Bank of America Merrill Lynch U.S. High Yield Master II Index.
The Alternative Thinking Week in Review market commentary and any accompanying data (“Market Commentary”) is for informational purposes only and shall not be considered an investment recommendation or promotion of FS Investments or any FS Investments fund. The Market Commentary is subject to change at any time based on market or other conditions, and FS Investments and FS Investment Solutions, LLC disclaim any responsibility to update such Market Commentary. The Market Commentary should not be relied on as investment advice, and because investment decisions for the FS Investments funds are based on numerous factors, may not be relied on as an indication of the investment intent of any FS Investments fund. None of FS Investments, its funds, FS Investment Solutions, LLC or their respective affiliates can be held responsible for any direct or incidental loss incurred as a result of any reliance on the Market Commentary or other opinions expressed therein. Any discussion of past performance should not be used as an indicator of future results.