Junk Bonds May Reduce Risks and Boost Returns Amid Stock Market Highs

1 min read
Source: MarketWatch
Junk Bonds May Reduce Risks and Boost Returns Amid Stock Market Highs
Photo: MarketWatch
TL;DR Summary

Amid record-high stock markets and eroding economic confidence, analysts suggest reallocating some investments into high-yield bonds, which historically outperform stocks during low-growth periods and offer lower volatility, potentially reducing overall portfolio risk while maintaining returns. However, risks include potential recession impacts and underperformance if the economy accelerates unexpectedly.

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