High Yield Bonds
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These bonds are typically issued with shorter . They are also less likely to have , which means that if a company’s financial condition or credit rating improves, the issuer can call its outstanding bonds and take advantage of lower funding rates. Emerging companies
While many high yield bonds are issued by former investment grade companies in decline, the high yield market also provides financing opportunities for emerging companies seeking working capital for expansion or to fund acquisitions. of high yield bonds are considered less likely to make interest payments than issuers of investment grade corporate debt. Because investors are being asked to assume this risk, high yield bonds tend to come with higher rates, which can generate additional investment income. Capital appreciation potential
Companies issuing high yield bonds have the potential to turn around their financial standing, creating the opportunity for investors to realize capital gains as bond values increase, due to improving business conditions or improved credit ratings. 2 data. Once you have made your purchase, we encourage you to sign up for Fidelity’s fixed income alerts to receive email notifications in the event one of your bond holdings is or placed on negative credit watch.
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High yield (non-investment grade) bonds are from issuers that are considered to be at greater risk of not paying and/or returning at . As a result, the issuer will generally offer a higher yield than a similar bond of a higher credit rating and, typically, a higher coupon rate to entice investors to take on the added risk. may not be repaid. Shorter maturitiesThese bonds are typically issued with shorter . They are also less likely to have , which means that if a company’s financial condition or credit rating improves, the issuer can call its outstanding bonds and take advantage of lower funding rates. Emerging companies
While many high yield bonds are issued by former investment grade companies in decline, the high yield market also provides financing opportunities for emerging companies seeking working capital for expansion or to fund acquisitions. of high yield bonds are considered less likely to make interest payments than issuers of investment grade corporate debt. Because investors are being asked to assume this risk, high yield bonds tend to come with higher rates, which can generate additional investment income. Capital appreciation potential
Companies issuing high yield bonds have the potential to turn around their financial standing, creating the opportunity for investors to realize capital gains as bond values increase, due to improving business conditions or improved credit ratings. 2 data. Once you have made your purchase, we encourage you to sign up for Fidelity’s fixed income alerts to receive email notifications in the event one of your bond holdings is or placed on negative credit watch.