Looking at incremental
yields of different asset classes can be revealing:
Not exact matches
In my prior post, I gave an overview
of the income options available in today's bond market, going over how much
yield was available from
different asset classes and how to think about the risks that
different bond investments carry.
The prevailing thinking is that given the
different risk profiles between the
asset classes, the recent level
of reward (
yield) does not compensate in the current economy.
High -
yield bonds can help you spread
assets across
different segments
of the financial market, reducing your risk concentration in any one
asset class in your overall portfolio.
Portfolio risk diversification High -
yield bonds are often considered a separate
asset class, involving
different characteristics from those
of other securities.